Market Updates

Gold was relatively flat this week after failing to break through the key US$1,300 level mentioned in last week’s commentary. We currently trade at US$1,283 per ounce and silver dropped back down to US$15.40 per ounce. The AUD/USD lost some ground so in local currency terms we are trading ever so close to $1,800 per ounce for gold and $21.50 for silver.

Waiting and watching in anticipation to see if gold is able to crack through near term resistance at the $1,300 level. We are currently trading around USD$1,292 and silver $15.50 per ounce. With the AUD slipping back to 0.719, gold trades at $1,800 and silver $21.72 in local currency terms, at time of writing.

Volatility in financial markets continued in December, leading to some pretty amazing moves in forex, equities and precious metals during the break. After recent consolidation short-term, gold in USD continues the battle for the $1,300 handle and we were trading just under this key level this week, but so far resistance at this level has stemmed the rally, with gold retreating to USD $1,288 and silver to USD $15.60.

With the end of 2018 quickly approaching, this will be our last market update for the year. So something a little different, we will take a look back on 2018 with some of the more interesting charts in finance that defined a year of excessive risk appetite across multiple asset classes, and potentially, several market tops.

After a sharp rally Friday night, gold continued to edge higher this week before encountering some resistance at the USD$1,250 level.  Overall, short-term trend appears positive and we are currently trading around USD$1,245 for gold per ounce and silver USD$14.72, higher than this time last week. In local currency terms, the AUD/USD is slightly lower at 0.722, with gold trading at AUD$1,728 and silver at $20.65.

Gold staged a breakout this week as panic struck equity markets on Tuesday night. Gold jumped to USD $1,238 and silver hit USD$14.50. In local currency terms, the rally in precious metals combined with a drop in the AUD/USD to 0.724c boosted gold prices past AUD $1,700 and silver back above $20 per ounce. A tip of the hat to those clients capitalising on the initial spike in AUD, which saw gold start the week at a low of $1,655.

Gold held a relatively tight trading range this week as we currently trade slightly lower at USD $1,221 per ounce, with silver sitting around USD $14.30 per ounce at time of writing.
Not a very action-packed week for precious metals markets as participants digested the statements of the Federal Reserve chief Jerome Powell.

Precious metals tiptoed higher this week, despite USD strength remaining. Gold in USD held the all-important psychological $1,200 handle successfully and has climbed to USD $1,228 at time of writing. Silver needs to hold USD $14 and has been successful so far, with prices hovering around USD $14.50 at present.
In local currency terms, both metals are trading slightly higher at AUD $1,694 and AUD $20.20 respectively with the AUD ever so slightly lower than last Friday.

It’s been another volatile week for precious metal prices, with gold at one point falling below USD $1,200oz, before rallying to current levels around USD $1,215oz. Silver has also been affected, trading as low as USD $13.90oz, though like gold it has reversed the losses seen earlier in the week, and last traded at USD $14.40oz.

If you think it’s been a tough week for equity markets and commodity bulls, spare a thought for those with their money in cryptocurrencies.

Last trading just above USD $14oz and below AUD $20oz, it’s been a tough few weeks for silver, which is now down almost USD $1oz, or 5% since the start of November. The decline in silver has helped bring the gold to silver ratio (GSR) to 85:1, more than double what it was back in 2011. As per the chart below, silver is now at its cheapest point relative to gold in 25 years.

Whilst Japanese economic output has grown over the last five or six years, it’s been very slow going, unlike the assets on the BOJ balance sheet, which have exploded since 2011, as the nation’s central bank has bought up a huge stockpile of Japanese government bonds, as well as stocks and ETFs.

President Trump’s tax cuts and fiscal stimulus were always going to provide a sugar hit for the economy, with higher levels of growth than would otherwise have been seen.
The downside to that stimulus was always going to be seen in rising deficits, and this week we saw a stark illustration of that, with the US Federal government posting a USD $100 billion shortfall for the month of October.

Whilst the government is making noises about encouraging the banks to lend more freely, and surveys of Australians suggest they think it's the best time in three years to buy a house, the market itself is still deteriorating, with prices and transaction activity continuing to fall.

It’s been a savage few months for oil bulls, with the price of West Texas Crude (WTI) falling from approximately USD $76 per barrel to USD $56 per barrel in barely a month. That's a fall of over 25% – an extraordinary move which can be seen clearly in the chart below, which plots the price of WTI crude over the last year.

Precious metal prices for local investors have eased this week, as a bounce in the value of the Australian dollar helped pushed gold down toward AUD $1,686oz, whilst silver is at AUD $20.04oz. Prices in USD have also corrected – gold was last trading at USD $1,224oz, with silver at USD $14.55oz, as the metals remain within their recent trading ranges.

Precious metal prices have recovered from their correction earlier in the week, with gold currently sitting at USD $1,234oz, whilst silver last traded at USD $14.84oz. The moves cap what has been a great month for gold in particular, with the yellow metal up by over 2.3% in USD terms for October. Silver was essentially flat, with the Gold to Silver Ratio (GSR) increasing from 83:1 to 85:1 during this timeframe.

Precious metal prices have held their ground this week as global stock markets continued to crater. Gold is currently sitting at USD $1,233oz whilst silver is at USD $14.74oz, both largely uncharged on the week. In local currency terms, gold is sitting just below AUD $1,750oz whilst silver is just below AUD $21oz, with the Australian dollar last trading at USD $0.7078.

Precious metal prices have consolidated last week’s strong gains, with gold currently trading at USD $1,225oz, whilst silver is sitting at USD $14.55oz. In Australian dollar terms, gold and silver are sitting at $1,728oz and $20.60oz respectively, with the AUD again falling below USD $0.71. Overnight, we saw more volatility creep into equity markets, with the S&P 500 down nearly 1.50%, whilst the NASDAQ fell over 2%. European stocks were also in the red, with the DAX down 1%, whilst losses were also seen in Asia.

Gold prices soared overnight, with the price of the yellow metal last trading at USD $1224oz, whilst silver is now sitting at USD $14.66oz, with the yellow metal now on track to close up for the week, after a sharp decline saw the price pull back below UDS $1185oz just three days ago. In Australian dollar terms, gold has well and truly reclaimed the AUD $1700oz level, and last traded at AUD $1722oz, whilst silver is back above AUD $20.50oz, with the local currency fetching USD $0.71.

Gold continues to battle the USD $1,200 level this week and we saw Silver catch a bid and hold the US$14.00 level comfortably. Eyes are on the Australian Dollar as it fell through key support this week and continues it’s bearish trend lower.

Until last nights price action, gold and silver had remained largely stuck within its recent trading range, and on track to a record a flat monthly return for September. However, after a sharp fall overnight (seen on the chart below in green), the yellow metal is currently trading at USD $1184oz, whilst silver is at USD $14.40oz, with the yellow metal now down close to 1% for the week.

Gold is currently trading at USD $1203oz, whilst silver is at USD $14.30oz, with the precious metal market continuing its recent consolidation. In Australian dollar terms, gold is trading at $1673oz, whilst silver is sitting just below $20oz, with the local currency sitting at USD $0.719, boosted of late by stronger than expected GDP and employment figures. 
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With the recent dramatic sell-off in the silver spot price, we no doubt have many investors scratching their heads as to what is happening in the silver market, and questioning whether the sell-off will continue. Gold has finished the week higher and at the time of writing sits at AUD$1,674.00 per ounce. Silver, though, has continued to go counter-trend and finished the week lower at AUD$19.89 per ounce – $14 per ounce in US dollar terms.

The gold price in USD fell by 3% in the first half of August, declining below critical support at USD $1200oz, though it has since bounced back above this level. The savage sell off represented the culmination of a four month drawdown for the yellow metal, with the gold price declining from near USD $1350oz over this period.