Gold, Silver Primed For Break Outs as Recession Looms

GoldCore Note

Gold and silver have weakened today and have fallen from the 14 month high seen on Friday. Spot gold was down 0.4% at $1,338.30 per ounce in early U.S. trading. It surged to $1,358.04 on Friday, its highest level since April 11th, 2018.

The return of risk appetite as seen in gains for many stock market indices and some gains for the dollar on relatively good U.S. retail sales data may have led to the weakness.

Gold has had four weeks of gains and a correction is to be expected. However, given the Fed looks set to ease monetary policy again, we would expect any correction to be short and shallow.

Expectations for a rate cut and monetary easing at the July meeting remain at 85% according to the CME’s FedWatch tool.

There are increasing signs that many economies internationally are on the verge of recession. This too will support gold and it looks like it is set to break above major resistance between 1,370/oz and 1,400/oz in the coming weeks.

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LBMA Gold Prices (USD, GBP & EUR – AM/ PM Fix)

14-Jun-19 1352.45 1351.25, 1069.79 1070.33 & 1200.03 1201.80
13-Jun-19 1335.80 1335.90, 1054.21 1052.69 & 1182.85 1184.81
12-Jun-19 1336.65 1332.35, 1049.27 1045.76 & 1179.99 1177.26
11-Jun-19 1322.65 1324.30, 1040.53 1041.30 & 1168.96 1170.42
10-Jun-19 1328.60 1328.60, 1046.94 1048.66 & 1175.41 1175.94
07-Jun-19 1334.30 1340.65, 1049.16 1052.14 & 1184.19 1184.60
06-Jun-19 1336.65 1335.50, 1053.15 1051.17 & 1189.62 1185.92
05-Jun-19 1337.75 1335.05, 1052.01 1049.22 & 1185.38 1184.99
04-Jun-19 1323.60 1324.25, 1045.51 1043.77 & 1177.47 1177.26
03-Jun-19 1313.95 1317.10, 1039.47 1042.35 & 1175.99 1175.38