- Holiday in USA on Monday can cause a correction first.
Key US economic data releases over the next two weeks.
18th January (Wednesday): Producer Price Index (PPI December). Retail Sale (December)
26th January (Thursday): Durable Goods, Q4 GDP, New Home Sale.
27th January (Friday): Core PCE, Personal income and personal spending.
A lower PPI will cause gold to near $2000 and even break $2000 before 1st February FOMC meeting. BUT a higher PPI will confuse traders and could cause a sharp selloff in bullion, base metals, and stocks. Selloff (if any) will be temporary.
Next week, it will be a technical trade. Crash or sell off next week will be on failure to break key resistances. Gold has a resistance at every $20 between $1900 and $2020. A lot of traders are waiting for silver to break past $25.00 so that they can take a new silver investment position. Some are still not convinced that silver will be able to break past $25.00.
Chinese on week long holiday can cause profit taking in copper and industrial metals. One should not make investment decisions based on the debate between avoiding recession and soft landing. In my view, the current asset value does not reflect the impact of global interest rate hikes last year. A China reopening and subsequent growth in Chinese GDP this year will nullify the impact of previous year interest rate hikes. BUT a global slowdown (with China reopening) will lead the road to a ZIRP (zero interest rate policy) on or after 2024. We need to be very careful on our medium term investment and long term investment. Gold, silver, and copper traders do not worry. They are in a long term bullish run. Short term price corrections will not alter the long term bullish trend.
Spot Gold:
- Daily support: $1870.30
- Daily resistance: $1909.80
- Gold needs to break and trade over $1909.80 to rise to $1932.80 and $1958.70.
- Spot gold will crash only if it does not break $1909.80 today to $1870.30 and $1848.00.
Spot Silver:
- Daily Support: $23.00 and $23.50
- Daily Resistance: $24.09 and $24.80
- Spot silver has to trade over $23.50 to rise to $24.30 and $24.96
- Crash or sell off will be there only if spot silver trades below $23.50 after London opens.
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