Credit rating of certain banks were cut on Monday. Credit rating of USA was cut last month. Bond yields are rising and are near a multi decade high. Gold and silver rising along with bond yields implies higher safe haven demand. (Generally there is an inverse correlation between bond yields and gold/bullion price.).
I will be seriously concerned only if the Federal Reserve officials confirm of rising interest rates on 1st November meeting and 13th December meeting in Jackson Hole central bankers meeting on Friday and Saturday. I will prefer to ignore everything else. September to January retail spending and jobs hiring will be the key for USA, UK and Eurozone. Summer will be over in two week’s time, in so called developed nations. Hiring by companies in leisure and travel will be over. This sector and some other will see cyclical layoff of temporary workers. The multiplier effect could be lower NFP and ADP number for September to January months. Inflation will fall or stabilize for the next six months. Interest rate pause by the Federal Reserve should be there after 20th September FOMC meeting.
Political factors and political compulsion will dictate interest rate decision by the Federal Reserve. The world is around fourteen months for the next US Presidential election vote. Early 2022 has given us a glimpse of how the Federal Reserve makes a swift “U turn” on interest rates. This can happen for interest rate cuts as well.
My eyes and ears are fixated on the Japanese yen more and less on the US dollar index. A section of traders are expecting usd/jpy to form a long term top between 155-160 zone. I expect usd/jpy to form a long term top by the third week of October. A falling trend usd/jpy is needed for the US dollar index to crash and Asian currencies to gain.
A big short covering will be there if there is a sustained break of key resistances in gold, silver and copper. Watch the current price closely.
COMEX GOLD DECEMBER 2023
- Key price to watch: $1921.80
- Comex gold December can rise to $1949.50 and $1960.00 as long as it trades over $1921.80.
- Mild sell off will be there if gold December trades below $1921.80.
- Crash or sell off in gold December will be there if and only if it does not break $1950.00 by 7th September.
NYMEX CRUDE OIL (October 2023)
- Key price to watch: $80.10
- Crude oil has to trade over $78.90 to rise to $83.60.
- Crash or sell off will be there if crude oil trades below $78.90 after the release of US weekly crude oil inventories at 8:00 pm Indian time to $76.10.
- Fifty day moving average of $76.10 is the key short term support.
Disclaimer: Any opinions as to the commentary, market information, and future direction of prices of specific currencies, metals and commodities reflect the views of Chintan Karnani. In no event shall I have any liability for any losses incurred in connection with any decision made, action or inaction taken by any party in reliance upon the information provided in this material; or in any delays, inaccuracies, errors in, or omissions of Information. Nothing in this article is, or should be construed as, investment advice. All analyses used herein are subjective opinions of mine and should not be considered as specific investment advice. Investors/Traders must consider all relevant risk factors including their own personal financial situation before trading.
Disclosure: I do not trade/invest in spot gold and spot silver and even in comex future.
NOTES TO THE ABOVE REPORT
- ALL VIEWS ARE INTRADAY UNLESS OTHERWISE SPECIFIED
- Follow me on Twitter @chintankarnani
- PLEASE NOTE: HOLDS MEANS HOLDS ON DAILY CLOSING BASIS
- PLEASE USE APPROPRIATE STOP LOSSES ON INTRA DAY TRADES TO LIMIT LOSSES.
- THE TIME GIVEN IN THE REPORT IS THE TIME OF COMPLETION OF REPORT
- ALL PRICES/QUOTES IN THIS REPORT ARE IN US DOLLAR UNLESS OTHERWISE SPECIFED.
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