DAILY REPORT : Tuesday 3 Apr 2018

MACRO: U.S. equities fell sharply on Monday as markets returned from the Easter long weekend, seeing the S&P 500 close below its 200 DMA for the first time since June 2016. The bourse declined -2.23% to 2,581.88 points on the back of broad based weakness (all 11 components lower), led by a -2.48% fall to technology stocks as Amazon tumbled -5.21% following further criticism by President Trump via Twitter. The DJIA fell -1.90% to 23,644.19 points, with UnitedHealth Group Inc. the only component of the bourse’s 30 to close in positive territory. Heavy trade across technology stocks saw the Nasdaq collapse -2.74% to 6,870.119 points, taking the Arms Index, a volume weighted breadth measure, to a high of 2.238 (readings above 2.000 are viewed as having panic like characteristics) and the bourse down -0.5% for 2018. Markit’s U.S. manufacturing PMI (final) eased modestly during March from earlier estimates, however was an improvement on February’s 53.3 and marked the highest final print since March 2015. The headline figure saw support from continued strength across output and new orders, while input prices accelerated at the fastest pace since November 2012. The ISM measure of U.S. manufacturing activity eased during March, printing 59.3 (exp: 59.6) to follow a 60.8 read in February. The employment sub-index fell 2.4 points to weigh upon the headline figure, while production and new orders also pulled back. Construction spending in the U.S. inched just +0.1% higher in February (exp: +0.4%) from an unchanged read in January. The greenback endured whippy trade on Monday, however ended the session mostly unchanged as the DXY index ended +0.03% lower. The dollar made back ground against the Euro, however fell underneath 106.00 against the Yen.

PRECIOUS: The sell-off to U.S. equities buoyed bullion on Monday, seeing gold through USD $1,340 and end the session +1.2% higher. The yellow metal saw interest in early Asian trade to reclaim USD $1,330, as Chinese demand saw the onshore premium jump to around USD $10 over London gold to fuel interest in spot. A softer greenback during European hours provided a level of underlying support to the metal, while the 'trade war' headlines in the U.S. mitigated a dollar reversal and saw gold to a USD $1,344.85 session high print. ETF's saw modest inflows on Monday of around 190,000 ounces, while vols remain firm as 1m pushes toward 11.0. Modest gains to USD/China in early Shanghai pricing saw bullion ease below USD $1,340 during Asian hours on Tuesday, while the upcoming two-day SGE closure likely saw some participants square short positions to further weigh upon the spot market. Bullion eased to a USD $1337.30 low to reverse pre-Chinese demand, however resting interest underneath USD $1,340 saw the metal hold a relatively tight range throughout the session, once again printing back above USD $1,340 as Europe filtered in. Interest around USD $1,335 will provide the first level of support for the metal and should see resting bids to restrict any tests lower toward the 50 DMA of USD $1,331.50. Top-side targets for the metal extend through USD $1,345 to the key USD $1,350 level. After breaking above USD $16.50 during early U.S. hours on Monday, silver eased marginally during Asian trade today following an early session test of the 50 DMA at USD $16.62. Monday's New York high print of USD $16.66 comes at the 100 DMA, while the metal needs to break through the 200 DMA of USD $16.78 to find some clean air and instill confidence into participants. Both platinum and palladium remain heavy, notably palladium which saw losses extend further today toward USD $930. Data today includes German retail sales and French, German, Eurozone and U.K. Markit manufacturing PMI prints.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Monday 26 Mar 2018

MACRO: U.S. equities fell sharply on Friday as investor concerns over a trade war with China saw the DJIA to the lowest level since November. The major bourse's did see early session interest following the signing of a USD $1.3 trillion spending bill that was 'reluctantly' actioned by President Trump in order to stop a potential government shutdown. Declines, however accelerated in the final hours of trade to see the DJIA -1.77% lower to 23,533.20 points, closing within correctional territory to now be -11.6% down from its 52 week high. The S&P 500 collapsed -2.10% to 2,588.26 points with all eleven components ending lower, led by financials (-2.99%) and technology (-2.73%), while the Nasdaq ended -2.43% lower at 6,992.666 points. Over the week the DJIA sunk -5.7%, the S&P 500 fell -6% and the Nasdaq tanked -6.5% to see all three major bourse's log their worst weekly result since January 2016. U.S. durable goods orders surged +3.1% MoM during February (exp: +1.6%) to follow a -3.5% decline previously. Durable goods ex-transportation were also robust, increasing +1.2% (exp: +0.5%), while the closely watched orders of capital goods (non-defence, ex-air) jumped +1.8% MoM (exp: +0.9%) from a -0.4% print in January. New home sales in the U.S. declined during February, marking the third consecutive monthly fall, however there were positive signs with regards to supply levels. Sales of newly built single-family homes eased -0.6% MoM (exp: +4.6%) from an upwardly revised -4.7% fall in January (prev: -7.8%). At the current sales rate there is approximately 5.9 months of supply, an increase from January's 5.1 months of supply and the highest level since August. The median sales price was USD $326,800, +9.7% higher YoY. The greenback traded softer against majors on Friday, seeing the DXY index -0.2% lower on the the session and -0.8% down on the week to break four consecutive winning weeks. Notably, the dollar dropped to a 16-month low against the safehaven Japanese yen o the back of 'trade-war' concerns, seeing the pair touch a 104.60 session low. U.S. treasury yields eased on Friday to see the two-year yield drop the most on a weekly basis in a month. The two-year pulled back around 2.5bps to 2.254% and the 10-year eased just under 1bp to 2.82%. Oil futures surged higher on Friday as concerns over potential sanctions on Iran escalated. WTI spiked +2.5% to USD $65.88 per barrel, marking the highest close for a front-month contract since late January, while Brent crude jumped +1.9% to settle just over USD $70 per barrel. European stocks ended trade on Friday lower, seeing the Stoxx Europe 600 -0.90% to mark the weakest close since February 2017 and -3.2% down on the week. The German DAX tanked -1.77% to book a -4.1% weekly loss, while in the U.K. the FTSE 100 shed -0.44% to book the lowest close since December 2016 and hand back -3.4% on the week.

PRECIOUS: Bullion continued to push to fresh cycle highs on Friday, importantly breaking and closing above the recent resistance level around USD $1,340 - $1,343. Interest toward USD $1,330 supported the metal in early Asian trade, before headlines detailing China's response to the U.S. trade tariffs saw the yellow metal toward USD $1,340 into the Shanghai open. We saw mixed interest out of Shanghai as the on-shore premium opened initially below USD $7 before edging closer to USD $9 throughout the session. Offers around USD $1,340 kept the metal within a narrow range throughout the remainder of Asia and the majority of European hours, taking a further leg higher once New York filtered in as equity markets plunged lower. Stops broadly around USD $1,340 - $1,343 took bullion to a USD $1,350 session high, easing late but holding onto a +1.4% session gain and a +2.4% weekly return. Silver price action disappointed somewhat relative to gold, consolidating above USD $16.50, however unable to break above Wednesday's post-FOMC high print. Both platinum and palladium were well offered in New York on Friday to end -0.2% and -1% lower respectively, notably palladium was once again unable to consolidate above USD $1,000.

A mild early session bid tone to bullion during Asian trade on Monday was soon extinguished by resting offers around USD $1,350, as participants looked to take profits ahead of key resistance levels. Mixed dollar flows kept price action within a modest range throughout the session, while Shanghai opened at a mildly softer premium toward USD $8 relative to London bullion. Amid the tight range we saw decent two-way flow through Globex, with close to 50k lots having passed through the exchange as European names filtered in. Strong support for the metal expected underneath USD $1,345 with extension toward USD $1,343 - $1,340 (Friday's break-out level), while initial top-side targets extend through USD $1,350 to the 2018 high prints around USD $1,361 (mid-February) and USD $1,366 (late-January). A shortened week due to Easter holidays and we are likely to see participants focus upon 'trade-war' headlines and associated equity/dollar movements. Data releases today include French GDP, the Chicago Fed Nat Activity index and the Dallas Fed Manf. Activity index.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Tuesday 20 Mar 2018

MACRO: Weakness across the tech sector led by Facebook saw equities in the U.S. sharply lower on Monday, taking the DJIA into negative territory for 2018 as each of the 30 DJIA components ended lower. Facebook (-6.8%) traded heavily following reports that political analyst Cambridge Analytica were able to collect data from 50 million profiles without consent. The DJIA declined -1.35% to 24,610.91 points, the S&P 500 saw heavy trade to technology (-2.11%) lead all eleven of the bourse’s components lower to close the session -1.42% down at 2,712.92 points, while the tech heavy Nasdaq Composite collapsed -1.84% to 7,344.244 points. The broad market weakness saw the market volatility index, the VIX surge over +20% to 19.02, while at one point extending to a 21.87 high. The greenback traded under-pressure on Monday to see the DXY index decline -0.35%. The dollar traded briefly below 106.00 against the yen, while the pound ripped +0.6% higher to print a one-month high of 1.4088. Treasury yields in the U.S. ended modestly higher on Monday amid mixed trade. The 10-year inched +0.6bps higher to 2.854% and the two-year tacked on 1.7bps to 2.307%.

PRECIOUS: A recovering dollar kept a lid of gold price action during Asian trade on Tuesday, with the metal unable to continue Monday’s upward momentum. Monday's strong performance came amid falling equity markets and a softer greenback, with bullion rebounding strongly from early European weakness that took the metal underneath USD $1,310. The yellow metal pushed gradually higher leading into the U.S. open, before the equity market weakness in New York took gold sharply through USD $1,315 to a session high of USD $1,319.65. Options are firming with notable interest in near-term upside, seeing 1m vols out to 9.3 and and 3m just underneath 10. Gold net long positioning has lightened in recent weeks to now sits toward the lowest level this year, which should provide room for further top-side gains over the near-term. The overnight break-out point around USD $1,315 provided support for bullion within a narrow trading range during Asian hours today as physical interest out of China continued to keep price action buoyant. As we head toward Wednesday's FOMC rate decision, bullion has managed to edge away from the early March low of USD $1,303 and the 100 DMA of USD $1,305, however both continue to act as strong supportive levels should the greenback see interest dependant upon interest rate rhetoric that comes out of the FOMC. Data today includes U.K. CPI, German ZEW survey results and Eurozone consumer confidence.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Thursday 29 Mar 2018

MACRO: U.S. GDP outpaced expectations during 4Q, increasing +2.9% QoQ (exp: +2.7%) from an earlier estimate of +2.5%, however down from a +3.2% pace in 3Q. Imports grew at a revised +14.1% pace, mildly up on the +14.0% previously estimated, while inventory investment increased at a rate of $15.6 billion from $8.0 billion previously reported, subtracting 0.53 percentage points from GDP growth. Personal consumption expenditures increased at a +4.0% annualised rate (exp: +3.8%) during 4Q, revised upwards from a +3.8% estimate previously. Core PCE meanwhile held unchanged at +1.9% QoQ to be in-line with expectations. Pending home sales in the U.S. increased +3.1% MoM during February (exp: +2.0%) to follow a downwardly revised -5.0% print in January (prev: -4.7%). On an annualised basis, sales were down -4.4% YoY. Equity markets in the U.S. closed in negative territory for a second consecutive session on Wednesday, seeing choppy trade as investors grappled with mixed economic data and further weakness across technology stocks. The DJIA ended the session just -0.04% down at 23,848.42 points, while the S&P 500 dipped -0.29% to 2,605.00 points and the Nasdaq composite slumped -0.85% to 6,949.227 points. The greenback continued to push higher on Wednesday, making notable gains against the yen to touch a near one-month high. The positive U.S. GDP print helped to underpin gains, as the DXY index ended the session +0.8% higher. European markets closed mixed on Wednesday, seeing the Stoxx Europe 600 +0.46% higher to 369.26 points courtesy of gains to utilities and healthcare, while the German Dax pulled back -0.25%, however pared early session declines. In the U.K. the FTSE 100 finished +0.64% higher, supported by a weaker pound and gains across utilities. In Asia today, as I write the Nikkei is flat, the Shanghai composite is at +0.76%, the Hang Seng at +0.15%, and the ASX S&P 200 closed at -0.52%. Tonight we have weekly jobless claims, personal income, consumer spending, core inflation, Chicago PMI, and the consumer sentiment index out of the US; along with unemployment and inflation data out of Germany.

PRECIOUS: The precious under pressure from the rising US dollar as gold drops over 1.5%. Gold opened at $1345 in Asia and remained close to that level through most of the day, with the $7-9 SGE premium helping to support the market and decent producer selling capping any rise. Late in Asian hours the metal started to drift lower and sat at $1340 as London came in. After a brief consolidation period, London were sellers as the greenback found broad support. NY were happy to sell into the weakness and the yellow metal traded steadily lower to the day's nadir at $1323, followed by a finish slightly higher. Silver was dumped 30c to a week-low $16.24. PGMs were sold heavily also, with palladium again testing the March lows at $962 and platinum touching $930 for the first time since early Jan. The Philadelphia gold and silver index lost 1.97%. In todays trading, gold picked up a couple of dollars after the Asian open and has traded between $1326-28 for most of the day. The SGE premium is slightly elevated at around $9 over loco London which has prompted some decent buying out of China. The yellow metal is at $1327.40 as I write. Silver is all but flat for the day, the grey metal is at the high of $16.27 as I write. Gold can expect broad resistance between $1335-40, a consolidation above $1340 could prompt another run at the March high of $1356 that was printed earlier in the week. We should see close support at the overnight low of $1323, below that the 100 DMA is converging with the 2018 lows at around $1309-10 and we expect plenty of resting orders around that level.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Friday 23 Mar 2018

MACRO: President Trump signalled on Thursday that tariffs would be imposed on around USD $60 billion in Chinese imports. The tariffs however will only be imposed following a consultation period, and are expected to target sensitive technologies that the U.S. considers vital to their economy’s future such as robotics and artificial intelligence. President Trump also aims to pursue alleged breaches of intellectual property law by China. Equities in the U.S. fell sharply on Thursday following the ‘China trade war’ headlines, with major bourse’s opening softer after Wednesday’s FOMC announcement, while seeing losses accelerate late in trade on Trump headlines. The DJIA ended the session -2.93% lower at 23,957.89 points, marking the lowest closing level since early February and the second lowest close this year. The S&P 500 sunk -2.52% lower to 2,643.69 points to turn negative for the year, with financials (-3.70%) leading 10 of eleven sectors lower. Initial jobless claims in the U.S. increased by 3,000 to 229,000 (exp: 225,000) during the week ended March 17. The weekly print saw the four week moving average of claims increase by 2,250 to 223,750, while continuing claims fell by 57,000 to 1.828 million during the week ended March 10, the lowest level since December 1973. IHS Markit reported the U.S. composite PMI index eased to 54.3 during March from 55.8 the month prior. The services PMI declined to 54.1 (exp: 56.0) from February’s six month high of 55.9, while the manufacturing PMI accelerated to 55.7 from 55.3 previously. The greenback saw mixed trade on Thursday to follow Wednesday’s FOMC driven weakness, however was able climb higher late in trade to book a +0.2% gain. The dollar regained ground against the pound after the pair spiked to a 1.4218 session high as the Bank of England warned that inflation is likely to stay above target at their March meeting (rates unchanged).

PRECIOUS: Bullion saw muted price action on Thursday even amid the equity weakness in the U.S., oscillating either side of USD $1,330 for the majority of the session before turning offered into the close and testing a break below USD $1,325. It was a very different story during Asian trade on Friday, with the metal well supported in early session pricing to reclaim USD $1,330 as the greenback traded well offered. Trade headlines out of China in response to the U.S. tariffs saw a heightened flight to safety leading into the Shanghai open, pushing gold through the post FOMC high print, however Chinese selling on the Shanghai open restricted any further tests toward USD $1,340 for the time being. It wasn't until we saw European names filter in that gold found the support required to break above USD $1,340, with focus now turning to key top-side resistance levels at USD $1,350 and broadly the recent high prints around USD $1,361 (mid-February) and USD $1,366 (late-January). Silver continues to lag behind gold, however was able to reclaim USD $16.50 in Asia today, while platinum tries to build a base around USD $940 - $950 and palladium struggles to break back above USD $1,000. Today we see durable goods orders and new home sales out of the U.S.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Monday 19 March 2018

MACRO: Housing starts in the U.S. collapsed -7.0% (exp: -2.7%) in February to follow an upwardly revised +10.1% gain (prev: +9.7%) in January. The decline saw the seasonally adjusted rate slide to 1.236 million (exp: 1.290 million) from 1.329 million previously. The print was largely a result of a -26.1% fall to multi-family construction, while single-family starts edged +2.9% over the month. Residential building permits slipped -5.7% MoM during February to follow a downwardly revised +5.9% print in January (prev: +7.4%). Industrial production in the U.S. jumped +1.1% during February (exp: +0.4%), marking the largest increase in four-months and largely led by a +4.3% increase in mining production. Capacity utilisation pushed to 78.1% from 77.4% previously, the highest figure since January 2015. Equity markets in the U.S. edged higher on Friday, benefitting from generally positive data releases to see the S&P 500 to snap a four-session losing streak. The bourse added +0.17% to 2,752.01 points with energy (+1.01%) leading nine of eleven sectors higher, while the DJIA ended +0.29% higher to 24,946.51 points. Over the week the S&P 500 posted a -1.2% decline, while the DJIA handed back -1.5%. The greenback saw mixed price action on Friday, however ultimately ended the session with a modest gain as to DXY index ended +0.1% higher.

PRECIOUS: Gold price action on Monday showed little to encourage participants that the metal is preparing to break outside of its recent range. The yellow metal skewed marginally to the down-side in early flows to test toward Friday’s low print, however benefitted from a USD $9 premium in China to restrict any further tests of the USD $1,310 support level during Shanghai's first session. Bullion turned lower once again as the far East returned from lunch, placing further pressure on support around USD $1,310 with little in the way of dollar moves to impart further downwards pressure. As we head toward this weeks' FOMC rate decision, we may see market support for the greenback weigh heavily upon bullion to test the lower end of the recent range. Expect interest around the early March low of USD $1,303 and the 100 DMA of USD $1,305 to remain supportive for the metal, while the key USD $1,300 level is likely to also see strong interest. Any extensions though these levels will open a test toward the 200 DMA at USD $1,290. Silver continues to trade heavily and looks likely to test toward USD $16.18 - $16.20 for the third time since early February, while platinum is through USD $950 and looking to print a fresh 2018 low.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Wed 28 Mar 2018

MARKETS/MACRO: U.S. stocks came under pressure in late-afternoon trade on Tuesday, as a sell-off in the technology sector fuelled a rout that threatened to wipe out Monday’s powerful perfomance. The Dow Jones Industrial Average fell -344.89 points, or -1.43%, to 23,857.71, the S&P500 retreated -45.93 points, or -1.73%, to 2,612.62 and The NASDAQ Composite tanked -211.737 points, or -2.93%, to 7,008.806. The best performing sector was utilities (+1.46%), while information technology was thrashed (-3.47%). European stocks on the other hand finished with healthy gains, breaking a string of losses as concerns about a potential global trade war eased and as investors turned their focus to corporate headlines. The EuroFirst 300 index leapt +17.65 points, or +1.24% to 1,438.35 and the Euro Stoxx 600 made similar gains of 4.39 points, or +1.21% to 367.57. Regionally the FTSE100 surged +1.62%, DAX rose 1.56% and CAC40 added +0.98%. Crude oil prices fell sharply overnight ( May WTI -1.2% to $64.66), as the market returned its focus back to U.S crude oil stockpiles. A Bloomberg survey shows the market is now expecting a rise of +850k barrels last week ahead of the EIA report today, which is despite OPEC continuing to point to falling inventories elsewhere around the world. Rates markets enjoyed the best rally of the last few weeks overnight, with yields in major markets lower by ~6–7bps. Fixed income caught a safe-haven bid as the equity markets view on tech stocks has soured, the U.S 10y yield decreasing -7.31bps to 2.7789% and the U.S 2y yield fell -0.43bps to 2.2661%. In FX, the Euro and Cable were relatively supported on the back of the risk-off selling, though commodity currencies traded with quite an offered tone. The AUD has been the clear under-performer in the G10 space over recent weeks and again yesterday, with traders noting that the AUD has been hard to chase with the equity moves.

On the data front the U.S Conference Board said Tuesday its measure of Consumer Confidence decreased to 127.7 in March (131.0 expected) from an 18-year high of 130.0 in February. This month, the present situation index fell to 159.9 from 161.2 prior and the expectations index dropped to 106.2 from 109.2 last month. The Conference Board survey ran through March 15, so it captured financial market volatility earlier this month. U.S. equity markets fell in early March, as investors worried that U.S. tariffs on steel and aluminium could hurt firms that use the metals to manufacture goods. Stock prices have recently risen as trade fears ease. The Richmond Fed's manufacturing index decreased to +15 in March (22 expected), versus a 28 reading seen in February. Overall, downward pressure stemmed from new orders (17, down from 27), shipments (15, down from 31), the number of employees (11, down from 25), the average workweek (12, from 28) and wages (22, from 23). Across the Atlantic, the Euro-zone Consumer Confidence Index was unchanged in March at 0.1, coming in on expectation. At first glimpse, it appears the hangover from political uncertainty, owing to the Italian election and German government formation difficulties, has persisted, suggesting investment and consumption spending may moderate somewhat in the near term. That said, the ongoing tightening in labour market conditions (the unemployment rate hit a 9 year low in January) should see confidence remain high overall.

The ECB’s Nowotny hinted that the Central Bank will look to unwind its bond purchases in September, stating it will have to decide during the summer what happens next and that he saw a clear possibility to reduce stimulus after September. It was interesting that he added that it was important for the ECB not to fall behind the curve, which suggests confidence is rising that inflation will return to target among the more hawkish caucus on the ECB governing council.

PRECIOUS: Gold ultimately retreated overnight despite trading to a fresh 6 week high ($1356.70) during the early European hours. The metal traded in a fairly robust fashion during the Asian day, exhibiting some brief selling leading into the Shanghai open, yet managing to hold onto the $1350 handle. Once China opened for business the USDCNY immediately made its way lower from 6.26 to 6.25, which bumped up the SGE premium to around $7-8 over the spot price and drew out some demand. There was persistent (albeit modest) Australian producer selling on the approach of $1355 however (XAUAUD ~$1750), which kept things in check as we moved into the afternoon. Very late in the Asia day and early London, the gold spiked to $1356.70, but lacked any follow through then quickly retreated to the then daily low just before the U.S stepped in. Despite the softer U.S equities and firmer treasuries, gold continued to slide throughout the U.S day, dropping to a low of $1340.15 but finding some support there. It recovered over the last few hours of trade to round out the session at $1345. For now we are holding onto the gains seen last week, although given the impulsive nature of the move, we suspect that weak longs may be stretched on a move back through $1340, paving the way for deeper retracement. Silver sold off in tandem with the gold yesterday, initially poking through the 200 dma ($16.78), which incidentally has held very well since February, only to be trounced back toward $16.50. PGM's also followed a similar trajectory. With the Easter holiday approaching we expect to see liquidity begin to dissipate in upcoming sessions.

It was a slower day today in terms of price action the gold quite happy to consolidate narrowly either side of $1345. With the U.S GDP scheduled to be released later today traders were happy to kick back and await the outcome. The gold opened at $1345.50 and initially dipped off slightly to the days lows just before the SGE kicked off. The premium on the exchange remained similar to yesterday around USD $7-8 over the spot price, and the volume churning through was two-way and moderate, having little impact on the LL gold price. With an absence of any meaningful local data the market remained quiet across all precious metals. In other markets, Asian equities are trading heavy at time of writing the Nikkei is -1.9%, Hang Seng -1.45%, Shanghai Composite -1.1% and ASX200 -0.75%. The dollar is a little softer across the G10 at present the AUDUSD the biggest winner so far up +0.25% (20 pips) to 0.7700, which is the current high. Attention tonight will be on the U.S GDP numbers, as well as pending home sales, building permits and wholesale inventories.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Thursday 22 Mar 2018

MACRO: The US Federal Reserve increased overnight interest rates by 25 basis points, in line with market expectations. The Fed's statement said that "The economic outlook has strengthened in recent months", their projections for the federal funds rate remained unchanged for 2018, however the forecast 2019 benchmark rate was upwardly revised to 2.9% from 2.7%. In the press conference that followed the announcement, Fed Chair Powell addressed the issue of tariffs, commenting that "there is no thought that changes in trade policy should have any effect on the current outlook". The White House advised that President Trump will sign a memorandum "targeting China's economic aggression" at 12:30pm on Thursday. Earlier in the day there were reports that China is threatening to retaliate to import tariffs by targeting US agricultural exports, heightening the fear of a trade war. US equities finished lower following the rate hike announcement after a volatile session. The Dow lost 44.96 points, or 0.18%, to 24,682.31 despite being up more than 250 at one stage, the S&P 500 fell 5.01 points, or 0.18% to 2,711.93, while the Nasdaq erased 19.02 points, or 0.26%, to 7,345.290. There were big wins for energy (+2.63%) and materials (+1.11%), while consumer staples (-1.32%) and REITs (-0.93%) led the losses. European equities were mostly lower, the EuroSTOXX shed 0.61 points, or 0.16%, to 374.96, the German DAX inched higher 1.82 points, or 0.01%, to 12,309.15, and the London FTSE 100 slipped 22.3 points, or 0.32%, to 7,038.97. In the currencies, investors dumped the US dollar following the FOMC rate hike announcement and accompanying press conference. The US dollar index dropped 0.77% to 89.678, the EUR traded up to 1.2347 while USD/JPY slumped to 105.91. US treasury yields were higher, the 2 year yield declined 4.55 bps to 2.2993% and the 10 year yield eased 1.84 bps to 2.8775%. The oil market rally continued as the EIA reported a decline in US crude inventories and the tension between Saudi Arabia and Iran appeared to escalate. Brent climbed 3.43% to $69.73 while WTI jumped 3.05% to $65.48. Base metals were broadly higher on the US dollar weakness, with zinc (1.44%) leading the gains. In US economic data, the current account deficit widened 26% to $128.2 bln in the fourth quarter of 2017, up from a revised $101.5 bln in the third quarter. The National Association of Realtors reported that existing home sales increased 3% in February to a seasonally adjusted annualised rate of 5.54M, the rise comes after two straight months of declines. In Asia today, as I write the Nikkei is at +0.71%, the Shanghai composite is at -0.81%, the Hang Seng at -0.63%, and the ASX S&P 200 is at -0.26%. Tonight we have weekly jobless claims, Markit manufacturing PMI (flash), Markit services PMI (flash) and leading indicators out of the US; Markit manufacturing PMI (flash), Markit services PMI (flash) out of the Eurozone; along with Markit manufacturing PMI (flash), Markit services PMI (flash), Ifo current conditions, and Ifo business climate out of Germany.

PRECIOUS: A bumper session for the precious as currency markets reacted to the news from the FOMC. Gold opened $1310 in Asia and we saw a mild bid tone throughout the session with investors remaining fairly subdued ahead of the FOMC announcement. The SGE premium was steady at $8 over loco London. The market plateaued at $1316-17 through London's AM session with traders were happy to sit on the fence. Gold started to tick up in early NY trading on headlines that China was preparing a retaliation to the US tariffs, the metal traded up to $1326 around lunchtime before easing to $1321 just ahead of the Fed's announcement. The greenback was sold sharply as the rate hike was announced and lost further ground following Powell's press conference, the move sent the yellow metal surging to the days high of $1336 before settling to a close at $1331. Silver surged almost 3% during NY hours to a week high $16.64. The PGMs caught a bid, with platinum and palladium finishing at $957 and $990 respectively. The Philadelphia gold and silver index jumped 3.16%. Quiet trading in Asia today, gold opened at $1331 and has remained within a $7 range. The SGE premium is steady at $8. There appears to be some softness creeping in during the afternoon as USD/JPY finds some support, the yellow metal is at $1329.40 as I write. Silver is still holding in above $16.50, the grey metal sits at $16.51 as I write. PGMs are in the black, with platinum posting a week high $962 earlier in the day. From a technical perspective, gold is sitting just under the 55 DMA at $1329.70, a consolidation above that level could see the metal make another move on the key resistance at $1340 and potentially the 2018 high after that. A rejection of the 55 DMA could see gold testing the support around $1318. 

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Friday 16 March 2018

MACRO: Initial jobless claims in the U.S. eased by 4,000 to 226,000 (exp: 228,000) during the week ended March 10. The weekly print saw the four-week moving average ease just 750 to 221,500, while continuing claims edged 4,000 higher to 1.879 million (exp: 1.903 million). Import prices in the U.S. increased +0.4% MoM during February (exp: +0.2%) to follow a downwardly revised +0.8% increase in January (prev: +1.0%). Imports of fuel weighed upon the headline figure to see ex-petrol imports print a +0.5% increase (exp: +0.3%), while export prices added +0.2% MoM (exp: +0.3%) following a +0.8% gain the month prior. Equity markets in the U.S. ended mixed on Thursday, with participants trading cautiously as the trade rhetoric out of the White House directed toward China escalates. The DJIA snapped a three session losing streak to book a +0.47% gain to 24,873.66 points, while the S&P 500 staged a late session recovery, however was unable to climb into positive territory and ended -0.08% down at 2,747.33 points to book a fourth consecutive decline. The greenback caught a bid on Thursday courtesy of up-beat economic data, however continued to run into headwinds against the safe-haven yen. The DXY index closed +0.45% higher after making notable gains against the euro (EUR/USD -0.5%) and the pound (GBP/USD -0.2%), while USD/JPY spent the majority of the session underneath 106.00 before turning bid late in trade to recapture the figure. Oil futures saw volatile price action on Thursday, ultimately ending the session higher following an International Energy Agency report forecasting a 1.5 million barrel per day increase in global oil demand in 2018. WTI closed the session +0.4% higher at USD $61.20 per barrel, while Brent crude posted a +0.45% gain to USD $65.10 per barrel.

PRECIOUS: Bullion continued to trade heavily during Asian trade on Friday following Thursday's -0.6% decline, once again testing support underneath USD $1,315 only to see resting interest restrict any further declines. Thursday's dollar strength weighed upon bullion, reversing what was a modestly up-beat Asian session to trigger a stop loss run through USD $1,320 in New York and touch the recent support trend line extending through USD $1,315. Muted early Asian trade on Friday gave way to early Chinese offers as USD/China pushed higher on the Shanghai open. For the third time in a week bullion tested toward USD $1,313, however once again saw interest around the support level to spend the remainder of the session paring early Chinese declines, and extending beyond opening levels as early European interest filtered in. Bullion continues to search for a catalyst to break out of the recent range, and in lieu of such an event we expect the metal to hold within USD $1,313 - $1,330, noting any extension lower should meet strong support toward USD $1,300. Data releases today include Eurozone CPI, U.S. housing starts, U.S. industrial production and the University of Michigan consumer sentiment gauge.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Tuesday 27 Mar 2018

MACRO: It was reported on Monday that following last weeks' tit-for-tat' trade war between the U.S. and China, that both parties have quietly commenced negotiations in the background to address trade imbalances. Talks have begun in Washington between China's Liu He and U.S. Treasury Secretary Steven Mnuchin and are expected to cover a wide range of issues including Chinese tariffs on U.S. autos and greater access to China's financial sector. In further White House news, relations with Russia have grown colder following an announcement that the U.S. will expel 60 Russian diplomats that they have identified as intelligence agents. The move comes following a similar action by the U.K. government after the alleged use of a nerve agent in the country. Equity markets in the U.S. ripped higher on Monday as concerns over a trade war between the U.S. and China dissipated. The DJIA surged 669.40 points or 2.84% to 24,202.60 points with all but one component of the bourse ending higher. The gain was the largest in percentage terms since August 2015 and the third largest single-session points gain in history for the bourse. The S&P 500 saw broad based gains led by technology (+4.03%) to end +2.72% higher at 2,658.55 points, with each of the bourse's 11 components ending in positive territory. The Nasdaq Composite outpaced to end +3.3% higher at 7,220.543 points. The Chicago Fed National activity index jumped to +0.88 (exp: +0.15) during February to follow a downwardly revised +0.02 the month prior (prev: +0.12). Of the 85 indicators that make up the index, 63 made positive contributions, led predominately by production related indicators (factories). The less volatile 3-month moving average registered 0.37 during February, a sharp increase from January's 0.16. The Dallas Fed manufacturing activity index declined in March to 21.4 (exp: 33.5) from 37.2 previously. The greenback continued to slide against majors on Monday, notably losing ground against the euro to see the DXY -0.4% lower. The euro saw gains after German central bank president Jens Weidmann, who is also part of the ECB rate setting committee, sounded hawkish with regards to normalising monetary policy. The dollar did however manage to chalk up a win against the yen, gaining around +0.7% as fears over a China - U.S. trade war subsided. Major European bourse's were unable to match their U.S. counterparts on Monday, instead booking losses as a stronger euro out-weighed the easing trade tensions between China and the U.S. The Stoxx Europe 600 declined -0.72% to 363.18 points to end at the lowest level since February 2017, while the German Dax sunk -0.83% to 11,787.26 points. In the U.K. the FTSE 100 declined -0.48% to end at 6,888.69 points on the back of a stronger sterling, the lowest closing level for the bourse since December 2016.

PRECIOUS: Another positive session for bullion on Monday, importantly breaking through USD $1,350.00 and closing above the figure. Early session profit taking out of Asia saw USD $1,350 hold as a formidable resistance level, while Chinese demand was modest at an on-shore premium toward USD $8 to underpin price action and temper any declines. Late Asia / early Europe tested Friday's break-out level around USD $1,343, however the support remained resilient to see the metal once again set sights on USD $1,350. Dollar weakness in New York underpinned a leg higher to bullion, while it is worth noting that Chinese interest was evident in the lead up as USD/China collapsed (USD/CNY from 6.31 to 6.27). Furthering the move in New York through USD $1,350 was the news that 60 Russian diplomats would be expelled from the U.S. following the alleged use of a nerve agent in the U.K. Gold traded to a USD $1,355.70 session high to end with a +0.45% gain on the session. Silver pricing finally gained some traction on Monday after lagging in recent sessions, withstanding tests toward USD $16.50 in early Europe to end around USD $16.70 for a +0.9% gain.

Asian trade today saw bullion encouragingly consolidate Monday's U.S. price action, withstanding an early bout of profit taking that revealed a USD $1,351.20 session low into the Shanghai open. Early Chinese interest buoyed price action to see gold back toward USD $1,354, with the far East showing heightened physical interest, while the on-shore premium firmed modestly up to USD $9 and USD/China remained under pressure. Early European names took bullion through the previous session high, with initial top-side targets now extending to the 2018 high prints around USD $1,361 (mid-February) and USD $1,366 (late-January). With regards to supports, we will initially look for the metal to consolidate above USD $1,350, however an extension toward USD $1,340 - $1343 could viewed as a healthy position clear out following the recent price action. Silver broke to a USD $16.80 session high today and will be targeting a break above USD $17 following the failed attempt in mid February. It is worth noting that recent silver COTR data shows net non-commercial longs have significantly decreased, providing clear air for further top-side moves. Data releases today include German import prices, Eurozone consumer confidence, U.S. house prices, the Richmond Fed manufacturing index and the Conference Board U.S. consumer confidence

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Wed 21 Mar 2018

MACRO: The US Federal Reserve began their 2 day monetary policy meeting on Tuesday, with a 0.25% rate hike the outcome expected by most analysts. Investors will be paying close attention to the commentary from Chairman Powell for any indication as to whether the Fed will remain on track to hike rates three times this year, or look to tighten further. US equities rallied Tuesday following the previous sessions tech led sell-off. The Dow added 116.36 points, or 0.47%, to 24,727.27, the S&P 500 rose 4.02 points, or 0.15% to 2,716.94, while the Nasdaq gained 20.06 points, or 0.27%, to 7,364.300. There were wins for energy (+0.84%) and consumer discretionary (+0.62%) while telecoms (-1.01%) and utilities (-0.46%) led the laggards. European equities were higher, the EuroSTOXX put on 1.89 points, or 0.51%, to 375.57, the German DAX added 90.31 points, or 0.74%, to 12,307.33, and the London FTSE 100 picked up 18.34 points, or 0.26%, to 7,061.27. In the currencies, the EUR suffered a sharp sell off on the back of a disappointing economic sentiment reading out of Germany. The US dollar index firmed 0.75% to 90.435, the EUR tumbled to 1.2240 while USD/JPY traded up to 106.64. US treasury yields were higher, the 2 year yield rose 3.11 bps to 2.3386% and the 10 year yield gained 3.49 bps to 2.8904%. In commodities, oil markets rallied on concerns that increasing tension between Saudi Arabia and Iran could negatively affect supply. Brent firmed 2.01% to $67.38 while WTI climbed 2.16% to $63.40. Base metals were broadly lower on the stronger US dollar, with zinc (-1.78%) leading the losses. There was no significant economic data releases out of the US overnight. In Asia today, as I write the Nikkei is at -0.47%, the Shanghai composite is at +0.48%, the Hang Seng at +1.21%, and the ASX S&P 200 is at +0.24%. Tonight we have current account deficit, existing home sales, and the FOMC rates announcement out of the US.

PRECIOUS: US dollar strength weighs on the precious complex ahead of tonight's FOMC announcement. Gold opened at $1316 in Asia and printed the session high $1318 early on in proceedings. The SGE premium was around $7-8 and buying was muted, the market drifted lower through the day as the greenback firmed. The EUR was sold sharply against the dollar during the London AM session which accelerated gold's decline. The yellow metal printed the days lows of $1307 early in NY trading but, as it did yesterday, found enough support to bounce back above $1310. Silver was sold to a fresh 2018 low at $16.12 followed bow a bounce up to $16.18 at the close. PGMs were lower also, palladium in particular lost $19 off the high.The Philadelphia gold and silver index lost 0.68%. The SPDR gold trust holdings fell 0.04% to 850.54 metric tonnes. In todays trading, gold is up few dollars off the open with the $8.50 SGE premium prompting light buying out of China. The yellow metal is at $1313.0 as I write. Silver is grinding higher as the day progresses, the grey metal sits at $16.23 as I write. PGM's are all but flat. The US dollar has been the primary driver of the gold price over the last week, and market reaction to tonight's FOMC announcement is likely to dictate any near term move. Gold should find support at the $1307-08 level that has held over the last couple of sessions, and at the psychological $1300 level below that. On the upside, expect firm resistance at the 55 DMA $1329.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

 

DAILY REPORT : Thursday 15 Mar 2018

MARKETS/MACRO: Stocks declined Wednesday, with major indices coming off early gains, as fears of a potential trade war resurfaced after President Donald Trump announced that his administration will seek to trim the U.S.’s trade deficit with China by $100 billion via tariffs and U.S retail sales fell for a third consecutive month. The Dow Jones Industrial Average retreated -248.91 points, or -1.00%, to 24,758.12, the S&P500 sold off -15.83 points, or -0.57%, to 2,749.48 and the NASDAQ Composite trickled down -14.20 points, or -0.19%, to 7,496.811. European equities erased early gains and traded lower following the fall in the U.S. The Euro First 300 index declined -2.08 points, or -0.14% to 1,466.10 and the EuroStoxx 600 dipped -0.55 of a point (-0.15%) to 374.94. Crude oil prices fluctuated between gains and losses amid conflicting fundamental data, WTI ultimately closing at $60.93 (+0.35%). The weekly EIA report showed that crude oil inventories recorded a strong gain last week of 5.02m barrels, while inventories at Cushing, the delivery point for WTI, also rose for the first time in 12 weeks. The EIA report also showed another rise in U.S output. This was acknowledged by OPEC, which raised its estimate of U.S production in 2018 and revised oil demand projections higher, with inventories expected to continue to decline. The USD traded fairly flat on the day, the dollar index up +0.12% to 89.768. EURUSD came off the high above 1.2400 after ECB President Mario Draghi’s measured comments on the pace of rate hikes after it ends QE. It eventually closed just a touch lower by -0.2% to 1.2370. The U.S 10yr yield decreased -2.74bps to 2.8152% and the US 2yr yield rose 0.81bps to 2.2620%.

On the data front, U.S retail sales shrank -0.1% MoM in February (+0.3% expected), following an upwardly revised -0.1% decline (-0.3% prior) at the start of the year. It is the first time sales have shrunk three months in a row since April-June of 2012. Households cut back on purchases of motor vehicles and other big-ticket items which was the primary contributor to the fall. Core retail sales (ex auto and gas) edged up +0.3%, which was in-line with consensus. U.S. producer prices increased slightly more than expected in February as a rise in the cost of services offset a decline in the price of goods. The Labour Department said its PPI for final demand rose +0.2% last month (+0.1% expected), after increasing +0.4% in January. That lifted the YoY increase in the PPI to +2.8% in February from +2.7% a month prior. In Europe, German CPI eased to +1.4% in February (+1.4% expected), from 1.6% in January. This was the third consecutive decrease and the lowest since November 2016. On a monthly basis, consumer prices gained +0.5% largely due to higher prices of travel/holidays.

PRECIOUS: It was a relatively quiet session across the metals, with a modest turnover of 246k lots (GCJ8) on COMEX. We opened in Asia and once again and saw some decent demand from SE Asian customers and China. Leading into the SGE open some light selling came about and we fell to the Asia lows, although this was swiftly swept higher from $1325 up towards $1329 over the morning. The metal tested $1330 briefly, although there was some sizeable COMEX selling up around that area and the gold quickly turned south to $1325-26 where it clung into the Asia evening. London traders came in mildly on the offer and continued to steer the metals lower, catching a bid just before the U.S traders joined in. There was some volatility around the U.S PPI and retail sales figure, spiking briefly to $1329, but just as quickly sinking to the days lows around $1322. All in all a quiet inside day for the metals. The market continues to trade the range with Asian buyers stepping in under $1320 and spec profit taking and producer selling capping the topside around $1330-35. Gold will likely remain range-bound into next weeks FOMC, with the market eagerly anticipating a first rate rise for the year, given the economies improved data.

Once again Asia demand was prominent today, with the gold initially trading a dollar or so lower but stabilising around $1324. Prior to the China open the spot market caught a bid, with some Japanese banks looking for offers and driving the price back through $1325. The underlying bids persisted with the USD on the back-foot throughout the morning, predominantly vs. the JPY which traded through 106.00 to a low of 105.83. Into the afternoon the volume began to subside on COMEX and the SGE and the spot gold traded sideways at the upper end of the days range. At the time of writing the equity markets are all lower, led by the Nikkei which is currently down -0.7%, Hang Seng -0.65%, Shanghai Composite -0.15% and ASX200 -0.4%. WTI Crude is a touch firmer at $61.06, up +0.2% and the USD is a slightly weaker to flat vs. the G10, the outlier USDJPY, which continues to look heavy under 106. Ahead on the data calendar today look out for French CPI and U.S Empire manufacturing, jobless claims and Philly Fed Business outlook.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.