DAILY REPORT : Monday 1 Oct 2018

MARKETS/MACRO Global markets finished on a slightly quieter note on Friday with U.S equities closing largely flat. Instead, most of the action seemed to be emanating from Europe after the Italian government announced a proposal to run a 2.4% of GDP deficit in 2019. This saw Italian equities fall almost 4% with BSP yields jumping 25-30bps as markets digested what seemed like a large deviation from the careful culture of fiscal prudence built up in the last several years. This put a drag on Europe's broader equity indices, the EuroFirst 300 index sinking -12.6 points (-0.83%) to 1,503.57 and the EuroStoxx 600 relinquishing -3.2 points (-0.83%) to 383.18. In the U.S it was a much calmer affair, the Dow closed up +18.38 points (+0.07%) at 26,458.31, the S&P500 was flat at 2,913.98 and the NASDAQ Composite ticked up +4.385 (+0.05%) to 8,046.353. Brent Crude oil prices rose towards USD83/bbl on Friday, prices breaking the key resistance of USD80/bbl, with the market now eying oil prices at USD100/bbl. Market focus is on how much an OPEC production increase will compensate for the supply losses due to Iranian sanctions. Some of the major buyers of Iranian oil have already scaled back their imports ahead of US sanctions starting from 4th November, and Investors are continuing to hold bullish bets adding another 30,000 contracts in net long positioning. The Dollar Index edged up +0.3% last Friday to 95.12, which is up +1.0% for the week. EURUSD fell -0.3% last Friday to 1.1600 and down - 1.2% for the week, while USDJPY remained well supported last Friday despite the cautious risk tone in Europe and was well supported above 113.30. The pair closed a touch higher on the day up +0.3% to 113.70. The U.S 10Y bond yield climbed off the low of just above 3.02% on the European sell-off, yet managed to recover to close 1bp higher for the day at 3.06% and flat for the week.

On the data front U.S personal income and spending were generally in line with expectations, both rising +0.3% MoM in August. Decent growth momentum suggests the economy continues to expand at a healthy clip. Inflation data was also in line, with headline PCE rising +2.2% and +2.0% for core inflation. We have a busy week of U.S releases this week, including ISM manufacturing today, the ADP employment report and ISM services on Wednesday, factory orders and the final durable goods orders on Thursday, and the September U.S employment report on Friday. The market consensus is at 185k for non-farm payroll vs 201k previously with the unemployment rate seen dipping to 3.8% from 3.9% and average hourly earnings at 2.8% YoY from 2.9% previously.

PRECIOUS The metals rose slightly on Friday led by silver ahead of the week long holiday for China this week. Gold opened in Asia Friday and traded fairly flat leading into the SGE open around $1183-1184. It ticked a touch higher on the SGE open with the premium for onshore traders up slightly towards $8-9 over the loco London price in USD terms. Chinese demand was limited however given it was the last trade day for a week, most of the business leading into the holiday having been done earlier that week. During the PM session and when Europe entered the fray, gold fell off to the days lows to $1181.30. When the U.S joined the market the silver really began to kick higher pushing from $14.30 to $14.70 over the course of 3 hours. This helped to drag the gold and the PGM's higher, with the silver 2 ultimately settling around $14.65 where it rounded out the session. Gold and platinum held their ground reasonably well into the final few hours, although palladium, which had hit a peak of $1091 early on in NY, came crashing back to $1075 as profit taking soured the advance. Gold remains in a holding pattern for now, but with quite a bit of data out this week and less liquidity - with China on holiday - could it be the recipe to break out of the recent range?

Markets so far have been very quiet today with a number of regional centres within Asia out for holidays (China/HK/Australia). Gold opened around $1191 and held steady for the opening two hours although gradually started to edge lower as the morning wore on. With China absent we lacked a little of the natural support they usually provide and we fell through $1190 to trade around $1188.50-1189.50 over the afternoon. Silver continued to unwind some if Friday's gains also dipping back off to $14.60 after opening $0.08 higher. In other markets the USD was generally a touch firmer vs the majors, while most major equity markets were closed with the exception of the Nikkei which at time of writing is up +0.45% on the day. Brent crude is holding above $83.00 a barrel at $83.18 last and WTI at the time of writing is trading at $73.50. Ahead today on the data calendar look out for German retail sales, a host of Euro manufacturing PMI's and U.S ISM and construction spending.

 

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 25 Sep 2018

MARKETS/MACRO The Chicago Federal Reserve’s measure of economic activity showed robust factory output during August. The index held at 0.18 (exp: 0.20) following an upwards revision to July’s print (prev: 0.13), while the less-volatile three-month moving average skipped higher to 0.24 during August from 0.02 previously. Production related indicators contributed 0.16 in August from 0.10 in July, while employment related indicators lagged to contribute -0.01. The Dallas Federal Reserve measure of economic activity softened marginally during September, easing to 28.1 (exp: 31.0) from 30.9 previously. Equities in the U.S. ended lower on Monday as U.S. – China tariffs began to take effect and investors looked toward this weeks’ FOMC meeting. The DJIA declined -0.68% to 26,562.05 points, while weakness across real estate (- 1.89%), consumer staples (-1.50%) and materials (-1.32%) weighed upon the S&P 500 to see the bourse end -0.35% lower at 2,919.37 points. The Nasdaq Composite meanwhile bucked the trend to add +0.08% to 7,993.25 points. The greenback saw weakness in early New York on Monday, however was able to pare declines to end relatively unchanged. The dollar saw initial weakness against the euro following comments from ECB President Mario Draghi regarding an expected increase in underlying inflation, however soon recovered as focus returned back to the upcoming FOMC meeting. Markets in Europe traded heavily on Monday as trade jitters returned. The Stoxx Europe 600 sunk -0.56% to 382.47 points, the German Dax fell -0.64% to 12,350.82 points, while in the U.K. the FTSE 100 handed back -0.42% to 7,458.41 points on the back of a stronger pound.

PRECIOUS Further range bound price action during Asian hours today, with participants seemingly happy to sit on the sidelines and await the results from the upcoming FOMC meeting. China returned from Monday’s holiday and provided little in the way of price direction as USD/China held relatively stable to keep the onshore premium towards USD $6 - $7. Participants remain on the offer through USD $1,200 to cap any tests above the figure, while interest toward USD $1,192 - $1,195 continues to provide support. With regards to dollar direction, we see a number of ECB speakers today, with the potential for further comments regarding inflation trajectory similar to that of President Draghi yesterday. We saw a move through 1.18 on Monday, however it is difficult to see a sustained 1.18 handle before the Fed’s likely interest rate hike on Wednesday. Comex gold expiry today with notable size around USD $1,200, which is likely to keep the metal around the figure over the near-term. Silver struggles to make any headway through USD $14.40 and remained heavy during Asian trade today, looking likely to re-test underneath USD $14.20 over the near-term. Palladium posted further gains on Monday, however turned offered late 2 in Asia today to pare these gains. The metal is finding resistance above USD $1,060 difficult to break through and may be open to a leg lower following a recent increase in positioning amid stable forwards. Data releases today include U.S. S&P Core Logic house prices, The Richmond Fed manufacturing index and the conference board 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 19 Sep 2018

MARKETS/MACRO In trade related news, President Trump announced that the U.S. would be placing a 10% tariff on around USD $200 billion of Chinese imports from September 24, rising to 25% at the end of 2018. In retaliation, China announced tariffs on USD $60 billion of U.S. exports. Home builder confidence in the U.S. remained elevated during September according to the latest NAHB survey results, largely a result of softening lumber prices from recent record high levels. The NAHB housing market index held at 67 (exp: 66) as a firmer labor market also helped to support the print. Equities in the U.S. firmed on Tuesday as participants largely ignored the ongoing trade concerns as both the U.S. and China announced a fresh round of tariffs. The DJIA jumped +0.71% to 26,246.96 points to mark the best session in nearly threeweeks, while gains to consumer discretionary (+1.27%) and industrials (+0.89%) supported the S&P 500 +0.54% higher to 2,904.31 points. Oil futures ripped higher on Tuesday on the back of supply concerns out of Iran. WTI jumped +1.4% to USD $69.85 per barrel, while Brent crude climbed +1.3% to USD $79.03 per barrel. The greenback saw mixed trade on Tuesday, however was able to strengthen late in trade, pushing higher with treasury yields to see the DXY index gain +0.04% following early session tariff related weakness. The 10-year treasury yield pushed to 3.048% to mark the highest rate since May, while the two-year yield climbed 1.3bps higher to 2.80%, marking a near decade-long high. European equity markets ended higher, however held a relatively tight range amid the ongoing trade war headlines. The Europe Stoxx 600 tacked on +0.11% to 378.73 points, while the German Dax found support from autos to end +0.51% higher at 12,157.67 points. In the U.K. the FTSE 100 (-0.03%) closed little changed as the pound edged modestly higher on positive Brexit progress.

PRECIOUS Bullion saw mixed price action on Tuesday, however ultimately ended softer to slip underneath USD $1,200 during New York trade. Although losing touch with the USD $1,200 handle in early Asian trade following the fresh tariff announcement from President Trump, the yellow metal was generally well supported throughout the Asian session and interest was clear toward the recent support around USD $1,195. London opened on the bid following the retaliatory Chinese tariffs and had the metal back above USD $1,200, however the bid tone was soon exhausted, and New York offered the metal back underneath the figure as the greenback recovered from earlier weakness. Gold vols have softened marginally in recent sessions as we continue to hold within a tight range. The main movers overnight were the white metals, with platinum ripping through USD $800 on a tightening forward market to add +1.6%, while palladium finally consolidated above the 200 DMA to reclaim USD $1,000 and end +2.7% higher. A positive session for the precious complex during Asian trade today, reclaiming USD $1,200 following headlines out of China from Premier Li Keqiang noting that they will not engage in competitive currency devaluations. USD/China turned offered on the headlines, broadly weighing upon the greenback to support gold higher. The metal pushed above USD $1,200 into the Chinese lunch break and continued to see interest throughout the afternoon. Once again we are stuck in the middle of the recent range and will look to USD $,1200 as the first support, with broad extension toward USD $1,193 - $1,195. Resistance still sits around USD $1,205, with the key break-out level through USD $1,215. Platinum will now look to consolidate above USD $800 for a move to USD $850, while palladium should see support around the 200 DMA to target USD $1,040 - $1,050. Data today includes U.K. CPI, RPI and PPI, U.S. mortgage applications and U.S. housing starts.

 

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 28 Sep 2018

MARKETS/MACRO U.S. GDP held unchanged at 4.2% QoQ during Q2, underpinned by gains to consumer spending, net exports and business investment. Personal consumption increased +3.8% QoQ to be in-line with estimates, while core PCE outpaced to increase +2.1% QoQ (exp: +2.0%) from +2.0% previously. Durable goods orders in the U.S. surged +4.5% during August (exp: +2.0%) to reverse a -1.7% fall the month prior. Underpinning the headline print was a +13% increase in demand for transportation equipment as orders for civilian aircraft soared +69.1%. Durable goods ex-transportation meanwhile ticked just +0.1% higher (exp: +0.4%), while the closely watched orders for non-defense capital goods exair declined -0.5% during August (exp: +0.4%) from a +1.5% increase previously. Initial jobless claims in the U.S. increased by 12,000 to 214,000 during the week ended September 22, while the four-week moving average inched just 250 higher to 206,250. Continuing claims added 16,000 to 1.661 million (exp: 1.678 million) during the week ended September 15. U.S. pending home sales declined -1.8% MoM during August, (exp: -0.5%) from a -0.8% fall previously. The monthly print saw the annualised figure to 2.5% YoY (exp: -1.0%) from -0.7% previously. Equities in the U.S. rebounded from Wednesday’s declines on the back of the positive GDP print, however saw gains tempered throughout the afternoon. The DJIA ended trade +0.21% higher at 26,439.93 points, while gains to utilities (+0.96%) and technology (+0.54%) helped support the S&P 500 +0.28% higher to 2,914.00 points. The greenback clawed back ground against majors on Thursday following the Federal Reserve interest rate increase, seeing the DXY end +0.82% higher.

PRECIOUS Bullion exhibited further weakness during Asian trade on Friday following the overnight outside session. Dollar strength continues to be the main driver of downward pressure on prices, with a mild bid tone out of China reversed in late afternoon trade as the greenback extended higher. Shanghai saw the metal toward a USD $8 premium to provide underlying supportive price action, however sellers soon wrestled back control to see the yellow metal ease through the New York low print as Europe filtered in. Bullion continues to be susceptible to post FOMC greenback strength as well as month/quarter end USD demand, pressuring the metal toward support at USD $1,180, with risks extending through USD $1,172 to the August low print of USD $1,160. Worth noting is the Chinese holiday next week, which will remove physical interest from the market during Asian hours. Silver continues to trade resiliently and has held support around USD $14.20 thus far, with little risk of extension below this level during Asian hours today. Platinum is tracking heavily and sees USD $800 as a major pivot point, while palladium exhibited whippy pricing in New York on Thursday, however extended to fresh highs in Asian today. Data releases today 2 include French CPI, German Employment, U.K. GDP, Eurozone CPI, U.S. personal income, U.S. PCE, the Chicago purchasing manager index and the University of Michigan consumer sentiment.

 

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 24 Sep 2018

 

MARKETS/MACRO The Markit U.S. services PMI print for September (provisional) indicated a softening across the services sector, sliding to 52.9 (exp: 55.0) from 54.8 previously. The print was the softest expansion since March 2017, however it is likely that the weakness was partially related to storm activity on the east coast of the country. The Markit U.S. manufacturing PMI print for September showed an improvement in business conditions, increasing to 55.6 (prev: 55.0) from 54.7 in August. The print was the highest reading since May and saw support from strong growth across output and new orders. Equities in the U.S. closed mixed on Friday, however the DJIA was able to print a second consecutive all-time high, gaining +0.32% to 26,743.50 points. The S&P 500 eased just -0.04% to 2,929.67 points on the back of heavy trade across technology (-0.34%) and financials (-0.37%), while the Nasdaq slumped -0.51% to 7,986.96 points. Over the week the DJIA jumped +2.3%, the S&P 500 gained +0.9% and the Nasdaq Composite eased -0.3%. The greenback had a positive session on Friday (DXY +0.33%) to claw back some of the recent weakness, notably gaining ground against the pound following comments from British Prime Minister Theresa May warning Brexit talks had stalled. Oil futures saw volatile trade on Friday, however ultimately ended higher ahead of the weekend meeting of major oil producers in Algiers. WTI ended +0.82% higher just underneath USD $71 per barrel, while Brent crude tacked on +0.1% to USD $78.80 per barrel. Equities in Europe posted strong gains on Friday, with financial and mining stocks supporting the broader market higher. The Stoxx Europe 600 added +0.43% to 384.29 points to book a sixth consecutive session gain, while the German Dax jumped +0.85% to 12,430.88 points. In the U.K. the FTSE 100 surged +1.67% to 7,490.23 points as the pound turned sharply offered following Brexit headlines.

 

PRECIOUS A disappointing session for bullion on Friday, breaking sharply underneath USD $1,200 and failing to recapture the figure into the close. A stronger greenback and a fresh record for the DJIA weighed upon the yellow metal in Europe / New York, reversing an otherwise robust Asian session that saw the metal to a USD $1,210.70 high. Demand out of China saw buoyant price action throughout Asian hours, with the on-shore premium pushing toward USD $5 as USD/China skewed to the down-side. The metal initially tests toward USD $1,200 in Europe on the back of euro and pound weakness, while sharply moving through the figure in early New York (10,000 lots through Comex in one minute) to a USD $1,192.45 low. Interest broadly around USD $1,192 - $1,194 restricted any further declines and the metal ended just underneath USD $1,200 to book a -0.7% fall. Silver briefly tested below USD $14.20 in New York, however sharply reversed the majority of the declines to limit the loss to just -0.15%. Platinum was 2 dragged lower with the remainder of the precious to decline -0.88%, while Palladium remain buoyant to outperform and end flat on the session. Bullion held a narrow range on Monday with a mild down-side skew, however volumes were hampered by holidays in both Japan and China. An early session bid tone to the greenback following the weekend break-down in talks between the U.S. and China put pressure on the yellow metal, unable to hold onto Friday’s closing level. The DXY edged around +0.1% higher over the session, while a lack of physical interest with Shanghai on leave was most likely the reason for the offered bias to gold. Bullion remains sensitive to dollar flows and the ratcheting up of tensions between the U.S. and China and the current Brexit impasse should continue to support the greenback over the near-term. Initial support for the metal is expected broadly around USD $1,192 - $1,194, with an extension toward USD $1,185 should this level fail. Once again, the metal sees USD $1,200 as the first level of resistance, with USD $1,210 - $1,215 the key to a sustained move higher. Following Friday’s relatively resilient price action, silver disappointed in Asian trade to test toward USD $14.20, sliding -0.7% to threaten a move underneath the USD $14.17 New York low. All eyes on USD $14.05 - $14.08 and USD $14 to restrict a move toward USD $13.60 - $13.70. Data releases today include Germany IFO survey results, U.S. Chicago Fed activity index and the Dallas Fed manufacturing activity print.

 

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 18 Sep 2018

MARKETS/MACRO The main market drivers on Monday were headlines surrounding the trade war between the U.S. and China, with the latter potentially cancelling upcoming trade talks should President Trump go ahead with announcing further tariffs on USD $200 billion worth of Chinese imports. Investors traded cautiously ahead of an expected announcement, with technology including Apple and Amazon well offered on the back of the escalating tensions. The DJIA declined -0.35% to 26,062.12 points, while weakness across technology (-1.28%) and consumer discretionary (-1.27%) stocks weighed upon the S&P 500 to have the bourse off -0.56% to 2,888.80 points at the close. The tech-laden Nasdaq Composite bore the brunt of the weakness however, collapsing -1.43% to 7,895.792 points, marking the largest single-session fall since late July. Manufacturing activity in the New York region softened during August according to the latest Empire State index. The monthly print declined to 19.0 (exp: 23.0) from 25.6 the month prior, as new orders and shipments tracked heavily. The greenback reversed Friday’s gains on Monday on the back of the escalating trade concerns. The DXY index sunk -0.48% to lose notable ground against the euro (EUR/USD +0.54%) and the pound (GBP/USD +0.66%), while holding generally unchanged against the yen. Treasury yields edged higher once again on Monday, seeing the 10-year edge above 3% and the two-year edged just under 1bp higher to 2.786%. European equities ended mixed on Monday as ongoing trade concerns weighed upon investor appetite. The Stoxx Europe 600 edged +0.12% higher to 378.31 points, the German Dax eased -0.23% to 12,096.41 points, while in the U.K. the FTSE 100 slipped -0.03% to 7,302.10 points as the pound pushed higher on positive Brexit progress.

PRECIOUS Following Monday’s positive move back above the important USD $1,200 pivot point, gold slipped underneath the figure in early Asian trade following the announcement from President Trump of 10% in tariffs on a further USD $200 billion worth of Chinese imports. The headlines post U.S. equity market close saw the greenback open higher to weigh upon bullion, however supportive price action out of China (prem USD ~$6.50) saw the metal base around USD $1,197 to restrict further declines. Early afternoon headlines out of China; “China says cooperation is only right choice for China, U.S.” saw a reversal to the early session dollar strength into the Shanghai lunch break, however the yellow metal failed to recapture the USD $1,200 handle and spent the remainder of the afternoon holding toward USD $1,198. Heightened trade tensions between the U.S. and China should eventually become supportive to higher gold prices over the near-term and it is disappointing to once again see the metal under USD $1,200. Broad interest toward USD $1,193 remains supportive for bullion, however should the greenback firm further gold could extend through to USD $1,185. Resistance at USD $1,215 is the key for an extension to USD $1,230, with recent shorts likely to become nervous around these levels. Silver continues to see interest above USD $14 to restrict further tests underneath the figure, while platinum struggles to hold the key USD $800 pivot point and palladium tests offers around the 200 DMA.

 

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 27 Sep 2018

MARKETS/MACRO The FOMC hiked the US federal funds rate by 25 bps, a move that was widely anticipated by investors. The Fed’s forward predictions remain unchanged from the previous forecast, with one more rate hike expected in December and a further three in 2019. Language describing the policy position as “accommodative” has been dropped, however Fed Chair Powell commented that “Dropping accommodation does not change anything with regards to the path of policy”. US gave back early gains to finish lower after the rates decision. The Dow lost 106.93 points, or 0.40%, to 26,385.28, the S&P 500 fell 9.56 points, or 0.33%, to 2,905.07, while the Nasdaq shed 17.105 points, or 0.21%, to 7,990.367. The markets were weighed down by losses in financials (-1.27%), REITs (-1.15%) and utilities (-1.04%). European equities were higher, the EuroSTOXX added 1.15 points, or 0.30%, to 385.04, the German DAX rose 11.23 points, or 0.09%, to 12,385.89, and the London FTSE 100 gained 3.93 points, or 0.05%, to 7,511.49. The FOMC decision prompted some choppy trading for the greenback, but ultimately the range was fairly small. The US dollar index added 0.15% to 94.278, the EUR was as low as 1.1729, while USD/JPY traded down to 112.65. US treasury yields were lower, the 2 year yield eased 1.6 bps to 2.81% while the 10 year yield lost 4.5 bps to 3.05%. Oil prices were lower as US inventories increased unexpectedly last week, Brent sold off 0.2% to $81.65 while WTI fell 0.2% to $71.98. Base metals were mostly lower, with nickel (-1.0%) leading the losses. In US economic data, new home sales rose 3.5% to a seasonally adjusted annual rate of 629k. In Asia today, as I write the Nikkei is at -0.59%, the Shanghai composite is at -0.40%, the Hang Seng is at -0.27%, and the ASX S&P 200 is at +0.03%. Tonight we have weekly jobless claims, GDP revision, durable goods orders, core capex orders, advance trade in goods, and pending home sales out of the US; with loan growth, business confidence, services sentiment, consumer confidence, consumer inflation expectations, and industrial sentiment out of the Eurozone.

PRECIOUS The precious saw some volatility after the FOMC announcement but markets remained within recent the recent range. Gold opened at $1200 and remained within a tight range through Asian hours. The SGE premium started off around $6-7 before easing slightly through the day. After reaching the day’s high of $1202 the market began to ease into the London open. The market drifted $3 lower through the London AM session as the US dollar ticked up ahead of the FOMC announcement. Gold was fairly quiet through the morning in NY. Whippy trading after the announcement saw the yellow metal test $1200, plunge to the low of $1191, recover to $1198, then settle back at the earlier $1194 ahead of the close. Silver traded above $14.50 during Asian hours but was sold off as the USD started to gain ground during the London AM session. The grey metal closed near the lows at $14.29. In the PGMs, palladium managed to buck 2 the trend and finish ahead. The metal traded up to $1074, the highest level since January, before closing in front at $1066. In Asia today, gold opened at $1195.10 and made a slow grind up to the high of $1198.40 as USD/CNH came off. The SGE premium slightly firmer at $6-7 over loco London. The metal has come off during the afternoon as the greenback recovers, the market is at $1195.00 as I write. Silver opened at $14.34 and picked up $0.10 to reach $14.44, the grey metal is currently still in front at $14.39. PGMs are higher, platinum and palladium are sitting at $825 and $1070 respectively.

 

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 21 Sep 2018

 

MARKETS/MACRO US equities continued to rally on solid economic data, with both the Dow and S&P 500 posting record highs. The Dow added 251.22 points, or 0.95%, to 26,656.98, the S&P 500 gained 22.80 points, or 0.78%, to 2,930.75, while the Nasdaq rose 78.19 points, or 0.98%, to 8,028.23. Tech (+1.17%), consumer staples (+1.16%) and materials (+1.05%) led a near broad advance in the markets. European equities were higher, the EuroSTOXX advanced 2.65 points, or 0.70%, to 382.63, the German DAX rose 107.46 points, or 0.88%, to 12,326.48, and the London FTSE 100 put on 36.20 points, or 0.49%, to 7,367.32. In the currencies, the US dollar is trading broadly lower as investors fears around the China-US trade war start to ease. The US dollar index fell 0.7% to 93.898, the EUR climbed to 1.1783, while USD/JPY was as high as 112.57. US treasury yields were higher, the 2 year yield firmed 1.3 bps to 2.80% while the 10 year yield added 0.4 bps to 3.20%. Oil prices were lower as President Trump tweeted that OPEC needs to “get prices down now!” ahead of the weekends meeting in Algeria. Brent fell 1.4% to $78.60 while WTI sold off 1.3% to $70.77. Base metals were mostly higher, with zinc (+0.9%) leading the gains. In US economic data, the Philadelphia Fed manufacturing index rose to 22.9 in September from 11.9 in August, beating the economists forecast of a 19.6 reading. The National Association of Realtors announced existing home sales were unchanged at a seasonally adjusted annual rate of 5.34 million in August. The Conference Board’s leading economic index rose 0.4% in August after a 0.6% increase in July, pointing to solid growth in the third quarter. Household debt rose by a seasonally adjusted 2.1% to $106.93 trillion in the second quarter. Initial jobless claims fell by 3,000 to 201,000 in the week ending September 15, this marks the lowest level since November 1969. Continuing jobless claims fell 55,000 to 1.65 million. In Asia today, as I write the Nikkei is at +0.90%, the Shanghai composite is at +0.98%, the Hang Seng is at +0.93%, and the ASX S&P 200 is at +0.22%. Tonight we have Markit manufacturing PMI (flash) and Markit Services PMI (flash) out of both the US and the Eurozone.

 

PRECIOUS Gold and silver post modest gains on broad USD weakness in a range-bound session. Gold opened at $1203 in Asia and traded up to $1206 after China came in. The SGE premium eased to $4-5 which capped the market. The metal saw a sweep down to the opening levels as London came in, and was sold to the day’s low of $1201 during the AM session. Gold rebounded into the NY open as the greenback came under broad selling pressure, posting a session high $1207 in early trading. There was another dip 2 during the afternoon but the yellow metal recovered to close near the highs at $1206. Silver tested the previous session highs in early trading before being sold off. The grey metal recovered through NY hours to close in front at $14.27. Another strong session for the PGMs, palladium printed a high of $1054 while platinum reached $834. In Asia today, gold opened at $1206.70 and ticked up to a week high $1209.70 in early trading. The SGE premium was firmer at $6 over loco London. The yellow metal has been consolidating around $1208 through the afternoon and sits at $1208.80 as I write. Silver opened at $14.29 and is slowly grinding higher through the day, the grey metal is currently at $14.38. PGMs appear to be taking a breather after an impressive week, both platinum and palladium have traded sideways today.

 

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 17 Sep 2018

MARKETS/MACRO Retail sales in the U.S. inched higher during August, advancing just +0.1% MoM (exp: +0.4%) to mark the slowest pace in six months, however data for July did see an upwards revision to +0.7% from +0.5% previously. The closely watched ‘core’ retail sales also edged +0.1% MoM higher following an upwardly revised +0.8% increase in July (prev: +0.5%). Industrial production in the U.S. increased +0.4% MoM during August (exp: +0.3%) to match July’s upwardly revised print (prev: +0.1%). The University of Michigan measure of consumer sentiment in the U.S. spiked during September, hitting 100.8 (exp: 96.6) from 96.2 previously. The print was the second highest since 2004 and was underpinned by confidence in the job market and increased wage expectations. Equities in the U.S. ended little changed on Friday as participants considered the potential implications of further sanctions between the U.S. and China. The DJIA inched just +0.03% higher to 26,154.67 points, the S&P 500 also crept +0.03% higher to 2,904.98 points and the Nasdaq Composite slipped -0.05% to 8,010.043 points. On a weekly basis the DJIA added +0.9%, the S&P 500 gained +1.2% and the Nasdaq Composite jumped +1.4%. The greenback regained the ascendancy against majors on Friday, seeing the DXY +0.43% higher as the buck took back ground from the yuan and the euro. Treasury yields edged higher on Friday following mixed data releases, with the 10-year pushing briefly to 3% before ending 2.8bps higher at 2.992%, while the two-year gained 2.5bps to 2.781%. European markets ended higher on Friday, largely supported by softer regional currencies. The Stoxx Europe 600 added +0.35% to 377.85 points, the German Dax gained +0.57% to 12,124.33 points and the French CAC climbed +0.46% to 5,352.57 points. In the U.K. the FTSE 100 strengthened +0.31% to 7,304.04 points as the pound traded offered.

PRECIOUS A relatively muted session for the precious on Monday following Friday’s weakness, possibly seeing some slack in the market on account of the Japanese holiday and severe weather conditions in Hong Kong. The greenback held a mild offered bias throughout the session to underpin supportive price action to bullion, with interest out of China notably picking-up as the on-shore premium pushed back toward USD $6.50. We saw headlines surrounding potential fresh tariffs on China by the U.S., however at a reduced rate of 10%, although aside from weighing upon regional equities the news saw little change to the precious. Offers on the way to USD $1,197 kept a lid on gains in late afternoon trade, however pricing remains constructive and layered bids underneath USD $1,195 are evident. The most recent CFTC data shows an increase in positioning across all metals, with shorts tapering off somewhat to possibly indicate we are beginning to see a short-term bottom. Broad interest through USD $1,193 - $1,195 remains in place to restrict further declines, however a sharp test toward USD $1,185 wouldn’t be out of the question 2 before the metal moves to re-test resistance at USD $1,215. Silver remains buoyant above USD $14 and didn’t test the figure on Friday, while platinum tracks heavily underneath USD $800 after losing the figure on Friday and palladium is still unable to breach the 200 DMA.

 

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 26 Sep 2018

 

MARKETS/MACRO Trading direction lacked conviction overnight with President Trump sounding relatively composed at the UN General Assembly. U.S equities were mixed with the Dow trailing off -69.84 points (-0.26%) to 26,492.21 and the S&P500 relinquishing -3.81 points (-0.13%) to 2,915.56, while the Nasdaq Composite strengthened slightly up +14.223 points (+0.18%) to push it over over 8,000. European stocks exhibited collective strength on the day, the EuroFirst 300 Index rallying +8.06 points (+0.54%) to 1,505.56 and the Euro Stoxx 600 up +1.75 points (+0.46%) to 383.89. Regionally the FTSE100 advanced +0.66%, DAX climbed +0.19% and CAC40 inched up +0.05%. Oil remained in focus with Crude prices rising sharply amid the ongoing fallout from the weekends OPEC meeting. Brent hit a fresh 4 year high ($82.55), before settling only slightly higher (Brent $80.89, WTI $72.04) following President Trump's call for OPEC to boost global output. Prices had initially rallied on supply concerns as U.S sanctions on Iran come into effect from November 4, with Trump continuing to encourage other nations to isolate Iran also. Elsewhere, the USD was slightly weaker as the Dollar index eased -0.1%. USDJPY rose +0.2% to 112.97 while the EURUSD was up +0.2% to 1.1767. U.S treasury yields rose 1-2bps across the curve at the start of the session with 10y yields touching yearly highs at 3.111%, later falling back to 3.096%. European yields rose also with 10y bunds up 3.3bps. The U.S. is moving forward on its bilateral trade deal with Mexico even if Canada is left out because negotiators can’t resolve their sharp differences over dairy and a dispute resolution system, U.S. Trade Representative Robert Lighthizer said. The Trump administration soon plans to present to Congress a text of the U.S.-Mexico trade agreement that was announced last month to revise portions of the North American Free Trade Agreement - according to Lighthizer. The timeline is important because current Mexican President Enrique Pena Nieto wants to sign the deal before he’s succeeded by Andres Manuel Lopez Obrador in December. Meanwhile there is no sign of a thaw in US-China trade relations, but Trump said nothing new in his address to the UN General Assembly. China said yesterday that it “won’t negotiate with a knife at its neck” and resumption in trade talks is entirely up to the US. It’s Fed Hike day today as markets have priced in a 100% rate hike with the FOMC meeting later tonight. What remains to be seen is the Committee’s signal about the prospects for rate hikes in the coming quarters. The possible change to the description of the policy stance as “accommodative” may be perceived as dovish by the markets also. On the data front, U.S reports highest consumer confidence data in 18 years overshooting street estimates considerably. Ahead of the FOMC meeting, this is a positive indicator for the U.S economy and supports Fed Funds rate hike consensus.

 

PRECIOUS Gold gained ground yesterday but ran into resistance above $1200, capped by quarter end producer selling and anticipation of a U.S rate hike today. We opened at $1198.50 in Asia yesterday and the metal held fairly steady leading into the China open. Once their day commenced on the SGE there was an influx of selling on ECOMEX and 2 spot gold as a result fell. China were on the offer also and we dipped off briefly to the days lows of $1197.40, before recovering into the latter part of the AM session. The SGE premium was trading around a premium of USD $8 to loco London gold which drew out some further demand and pushed the metal back toward $1199. Volume remained decent throughout the Asia afternoon although price action was limited. We bounced through $1200 later in the day and held steadily around that level throughout the European day angling quietly higher throughout NY to an intra-day peak of $1203, before closing a touch lower at $1201. Silver was more active on the day, mainly the result of thinner conditions than its yellow cousin. Silver was sold down in Asia to $14.23, before rallying hard in NY to a peak of $14.55 and then easing back off on some late profit taking to $14.45. Gold remains in a holding pattern at the moment with the market looking towards tonights FOMC initially, then GDP tomorrow night to potentially shake things up. China will be out for a weeks holiday next week, which traditionally results in lower prices without their natural demand supporting, so will be interesting to see what develops over the coming week or so. A very quiet day today for the precious, gold confined to a tight $3 range between $1200-1202.50. We initially popped higher to $1202 just after the open in line with a slightly softer USD, although selling mounted as we moved toward the Shanghai open, spot dipping to $1200. Chinese traders in contrast to yesterday were buyers at the open and helped to bid up the spot market back toward $1202.00. We remained locked $0.50 either side of this for the remainder of the day, with good volume churning through both COMEX and the SGE, although once again the lack of price action has produced a dull session. Traders will be looking to tonight's FOMC, where a rate rise is almost 100% priced in, but more importantly investors will be looking for any guidance concerning future rate rises.

 

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 20 Sep 2018

MARKETS/MACRO Equities were on the rise overnight with treasury yields up a couple of basis points and the USD declining. The DJIA gained +158.80 points (+0.61%) to 26,405.76, the S&P500 tacked on +3.64 points (+0.13%) to 2,907.95, while the NASDAQ composite took a bit of a breather, down a marginal -6.069 points (-0.08%) to 7,950.038. European stocks also exhibited strength led by banking stocks, the EuroFirst 300 Index inclining +4.96 points (+0.33%) to 1,485.99 and the EuroStoxx 600 matching that, up +1.25 points on the day (+0.33%) to 379.98. Crude oil prices rose after data showed further falls in inventories, the WTI gaining +1.47% to $70.88 a barrel. U.S stockpiles fell -2.08 million barrels last week, according to EIA data, slightly less than the market was expecting. However, investors were buoyed by data showing that refiners utilisation rates were around 10% higher than this time last year, indicating that demand remains strong. The tightness in the global oil market and a wide spread between Brent-WTI (~$8.50 a barrel) also enticed the highest level of U.S exports since July at 2.37m million barrels per day. Brent crude prices were helped by reports that Iraq’s exports were weaker, dropping to 3.93 million barrels a day in the first half of September from 4.093 million barrels per day in August. The base metals sector was broadly higher, as investors took a ‘glass half full’ approach to the lower-than-expected 10% tariff on Chinese imports into the U.S. Investors appetite was also supported by a weaker USD in this space, LME copper gaining +0.6% to $6121 per tonne. In the G10 space, most of the focus was on $CAD last night after headlines broke that US-Canada trade talks were unlikely to materialise into an agreement this week, helping to send the pair briefly above 1.30 while Cable continues its recent advance, helped by a stronger than expected inflation print yesterday.

On the data front yesterday the U.S current account deficit narrowed to $101.5 billion or 2.0% of GDP from a downwardly revised $121.7 billion gap or 2.4% of GDP ($103.5 billion expected). The goods deficit decreased to $203.2 billion from $220.8 billion in the first quarter of 2018, as exports rose faster than imports and the services surplus increased to $69.3 billion from $66.8 billion. Still in the U.S, housing starts jumped +9.2% from a month earlier to an annualised rate of 1282k in August of 2018, recovering from a -0.3% drop in July and beating market expectations of a +5.8% advance. Starts increased in the South, the Midwest and the West and remained flat in the Northeast. In the UK CPI rose to an annual rate of 2.7% in August 2018 up from 2.5% in the previous month and comfortably above market expectations of 2.4%. It was the highest inflation read since February mainly boosted by rising prices of transport, recreation & culture and food & non-alcoholic beverages.

U.S. and Canadian negotiators facing a deadline at the end of the month are working long hours to keep Canada in a North American trade bloc. Canada's Minister of Foreign Affairs Chrystia Freeland resumed talks Wednesday with U.S. Trade Representative Robert Lighthizer. "Our negotiators have been really hard at it, including an all-night session last night that ended at 7 a.m." Freeland told reporters. Among other things, the negotiators are battling over Canada's high dairy tariffs and policies meant to keep the country's culture from being overwhelmed by U.S. movies and 2 television. Canada also wants to keep a dispute-resolution process that was part of NAFTA, the Trump administration however wants U.S. courts to have jurisdiction.

PRECIOUS Gold once again printed a higher peak than the previous session, despite relatively muted price action overall yesterday. We opened in Asia around $1198 and after spending a few hours around that level began to rise as we approached the Shanghai open. This was soon followed by the headline "CHINA PREMIER SAYS WON'T DEVALUE CURRENCY TO STIMULATE EXPORTS", which helped to improve the overall risk sentiment, sending USDCNH lower and gold higher through towards $1204. Throughout the European day the yellow metal chopped between $1202- 1204.50 on very light volumes, hitting the intra-day peak just as U.S traders came online at $1205.95. We did run into some selling pressure above $1205, particularly as it was around this time the USD began to rebound. Despite the selling though, the metal managed to hold above $1200 for the remainder of the session which was certainly positive, rounding the day out at $1204. It was generally real money and system accounts on the bid and producer accounts on the offer for most of the day. The PGM's were again the most interesting constituents within the precious complex yesterday. Palladium continued its solid form from the previous day, extending its rise through the 200 dma resistance ($988.50) and hitting a fresh cycle peak of $1043, taking the 2 day gain to an impressive +$50 (+5.15%). Platinum, although not to the same extent, has been robust, pushing through the 50 dma Tuesday ($808) and closing just off the intra-day highs yesterday at $823. Volumes have been noticeably higher over the past two days for both PGM's. Elsewhere, the World Gold Council said India should not alter their gold import import duties or or impose other curbs to support the Rupee. The council indicated towards the low current demand for gold during 2018 and said that gold is not the core of India's current account deficit problem.

Gold continued to grind higher in Asia today, in fairly uneventful trade despite some decent volume going through. The yellow metal opened around $1204 this morning and hovered around there for the opening few hours before the China came in. There was a brief rush of bids right on the open and spot gold as a result pushed through $1205 and continued up toward the overnight high ($1205.95). It pushed through there eventually and remains above that level as I write. Silver had a good run also, opening around $14.24 and pushing as high as $14.35 before easing a little into the AM session close. PGM's are quieter today, dipping initially on some initial profit taking, but then rallying to their respective highs following the Chinese open in line with a softer dollar. Ahead today look out for UK retail sales, Eurozone consumer confidence and U.S jobless claims and existing home sales.

 

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 14 Sep 2018

MARKETS/MACRO Consumer prices in the U.S. increased less than expected during August, rising +0.2% MoM (exp: +0.3%) to match a similar print in July. The monthly result was weighed down by declines to healthcare and apparel costs, seeing the annualised figure to +2.7% YoY (exp: +2.8%) from +2.9% previously. Excluding the volatile food and energy components, the so called ‘core’ CPI edged up +0.1% MoM (exp: +0.2%) to take the annualised figure to +2.2% YoY from +2.4% previously. Initial jobless claims in the U.S. eased marginally during the week ended 8 September, slipping 1,000 to 204,000 (exp: 210,000). The print saw the four-week moving average decline 2,000 to 208,000, while the number of continuing claims fell 15,000 to 1.696 million (exp: 1.710 million) during the week ended 1 September. Consumer confidence in the U.S. increased for the first time in five weeks according to Bloomberg. The consumer comfort gauge ticked up to 59.0 from 58.0 previously, led higher by improved assessments of personal finances. Equities in the U.S. ended higher on Thursday as technology stocks, notably Apple (+2.42%), recovered from recent weakness. The DJIA notched a +0.57% gain to 26,145.99 points, while gains to technology (+1.15%) and healthcare (+1.14%) helped to see the S&P 500 +0.53% higher to 2,904.18. The tech-laden Nasdaq Composite benefited from strength across tech giants to jump +0.75% higher to 8,013.71 points. The greenback extended recent declines on Thursday following the inflation report, losing ground once again relative to the euro and the sterling (Brexit driven) as the DXY index fell -0.32%.

The European Central Bank kept interest rates on hold as expected and reiterated its position that this should continue until at least next summer, while beginning to further scale back its bond buying program next month and finish altogether in December. ECB President Draghi took a marginally more hawkish position at his press conference, and while maintaining a ‘broadly balanced’ risk outlook and noting risks from protectionism and emerging market turmoil have become more pronounced, he noted the central bank remains comfortable with ongoing and solid broad-based economic growth. Equities in Europe closed mixed on Thursday, softening from early session gains as the euro turned bid. The Stoxx Europe 600 declined -0.15% to 376.52 points, while the German Dax added +0.19% to 12,055.55 points and the French CAC eased -0.08% to 5,328.12 points. The Bank of England also left benchmark interest rates unchanged in-line with expectations, however highlighted that although the U.K. economy is broadly on track, Brexit remains a risk. The U.K. FTSE 100 posted a -0.43% fall to 7,281.57 points, weighed down by weakness across energy and tobacco stocks, in addition to a firmer pound.

PRECIOUS Bullion saw mixed trade on Thursday, reversing a test above USD $1,210 following comments from president Trump denying the U.S. and China were going to restart talks on trade. The yellow metal saw 2 constructive price action throughout Asian and European hours to consolidate the previous session move through USD $1,200, with profit taking (notably Chinese selling) well absorbed by a healthy supply of bids. The softer than expected U.S. CPI print provided a boost for the metal, breaking above the previous session high to touch USD $1,212.70, however the Trump denial hit market sentiment and gave the dollar a modest boost to reverse the CPI driven gains. Gold saw late session weakness test toward the important USD $1,200 support level, however once again saw healthy interest restrict further declines. With regards to ETF flows we saw 70k ounces of outflows on Thursday.

Asian trade on Friday saw interest in bullion continue to underpin robust price action, pulling away from USD $1,200 and spending the remainder of the session either side of USD $1,205. The greenback skewed mildly to the down-side throughout the session, however was largely unchanged against China as Shanghai continued to hold an on-shore premium around USD $4 - $5. We saw a mild bid tone in bullion during early afternoon trade driven by comments from Japanese Prime Minister Shinzo Abe noting that he doesn’t think easing should go on forever, with USD/JPY marginally softer on the back of this. The near-term key for the metal remains supportive price action around USD $1,200, with a top-side break through USD $1,215 - $1,220 needed to instill confidence in participants and squeeze shorts. Silver has been testing resistance around USD $14.30 and a consolidated move through this level will open up targets at USD $14.50 and USD $14.70. Platinum has so far been able to hold USD $800 following the break on Wednesday and will look for this to continue, while palladium finds resistance around the 200DMA at USD $988 formidable for now. Data releases today include U.S. retail sales, U.S. import prices, U.S. industrial production and U.S. capacity utilisation.

 

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.