This is a big week for gold and silver. There will be short covering if they are able to rise and vice-versa. I know that short sellers are on the edge in gold and silver. They have opened their seat belts to short sell. Silver is buy on dips. Indian physical gold demand and Indian jewelry demand will be less in the short term due to covid worrying situation.
The fall in bitcoin and crypto currencies is just temporary. Crypto currencies is still a buyers den. Since May 2020, anyone who buys bitcoin, ethereum etc at any price has made bumper profit. There is no fear of making a loss as there is expectation that later than sooner a good profit will be made. Gold investment or a wrong selection of stock investment can result in short term trading losses. In Crypto currencies, this fear has yet to arrive. How can dogecoin rise over three hundred percent quickly? I am only worried over the pace of rise of crypto currencies and not the actual rise.
There is no major market moving US economic data releases this week. I will suggest to ignore all correlations like gold-bond yield ratio, gold-US dollar Index ratio, bitcoin to gold ratio among other and focus on the technical.
Federal Reserve meeting is there next week. Traders will start taking positions for FOMC meet next week. To me June FOMC meeting will be market shaking. I do not expect any surprises in next week’s FOMC meet. All central banks meetings in June (pre and post) will change the medium term direction of selected asset classes. My reason is vaccination process will be over in UK, USA and large parts of Eurozone. Normalcy will return. Tourism, travel, entertainment and people packed stadium sports will only increase consumer spending from June. These sector will add punch to job creation and growth in USA. UK, Eurozone and G7 nations.
Spot gold: View: Current price $1778.05 (i) Key support: $1746.20 and $1762.00 (ii) Key resistances: $1790.60, $1804.20 and $1829.90 (iii) Gold has to break and trade over 100 day MA of $1804.20 this week to rise to $1829.90 and $1842.60. (iv) Gold will crash to $1716.10 in case $1804.20 is not broken. (v) Keep on booking profit as long as gold does not break $1800.20-$1812.00 zone.
Spot silver: View: Current price: $25.81 (i) Key support: $25.08, $25.58 (ii) Key resistances: $26.04-$26.35 and $26.80. (iii) Silver has to trade over $25.80 this week to be in a bullish zone and rise to $26.78 and $27.59. (iv) There will be sellers as long as silver trades below $25.80.