DAILY REPORT : Wed 9 Aug 2017

MACRO: Tensions on the Korean peninsula have stepped up following reports from Japan that North Korea may have already developed nuclear warheads. Japan's annual Defence White Paper released on Tuesday noted that; "It is conceivable that North Korea's nuclear weapons program has already considerably advanced and it is possible that North Korea has already achieved the miniaturization of nuclear weapons and has acquired nuclear warheads," U.S. President Donald Trump increased his warnings to North Korea at an unrelated briefing in New Jersey, stating that; "North Korea best not make any more threats to the United States. They will be met with fire and fury like the world has never seen," Within hours of Trump's comments North Korea responded by saying they were "examining the operational plan" in reference to a potential strike on the U.S. Andersen Air Force base in Guam. Small business optimism in the U.S. increased to 105.2 during July (exp: 103.5) from 103.6 previously, marking the first increase since January. Business owners were buoyed in part by the pick-up in consumer spending, driving stronger hiring activity with a measure of those planning to add to payrolls relative to those planning to cut jobs currently sitting at the highest level since late 1999. The latest JOLTS job openings report increased by 461,000 to a seasonally adjusted 6.163 million during June (exp: 5.750 million), the largest monthly gain since July 2015. Professional and business services accounted for 179,000 vacancies, healthcare and social assistance had 125,000 openings, while construction had 62,000 unfilled positions. The print saw openings at the highest level since the data series began in December 2000 and saw the openings rate increase to a near 12-month high of 4.0%. The heightening tensions on the Korean peninsula saw equities in the U.S. sharply reverse early session gains on Tuesday, closing toward the low print to snap a recent run of positive closes. Following nine consecutive record closes the DJIA ended -0.15% lower at 22,085.34 points on Tuesday, as major financials reversed an early bid tone. The S&P 500 saw broad based declines as materials (-0.88%) and telecoms (-0.54%) led ten of eleven sectors lower to have the bourse down -0.24% at the closing bell. The greenback recovered from recent weakness on the back of the higher job vacancies report released in the U.S. on Tuesday, however pared some gains late in trade following the escalation in tensions with North Korea. After gaining as much as +0.6% intra-session, the DXY eased late to add +0.2% for the session, with notable gains coming against the euro (+0.4%) and the yen (+0.35%). Markets in Europe avoided the escalation in geopolitical tensions on Tuesday to end the session at near two-week highs. The Stoxx Europe 600 added +0.17%, while a -2.8% MoM fall in German exports and a -4.5% MoM fall to imports during July tempered the regional gains somewhat, however the Dax was able to recover to end +0.28% higher. A softer sterling provided support to equities in the U.K. on Tuesday, seeing the FTSE 100 +0.14% higher after briefly trading above its all-time closing high of 7,547.63 printed in late May.

PRECIOUS: Geopolitical tensions saw a sharp reversal in fortunes for bullion on Tuesday, as the metal ripped higher in late U.S. hours after testing toward the USD $1,250 support earlier in the session. Price action was generally at the whim of the greenback throughout Asian and European hours, breaking higher in Chinese trade as the local currencies gained ground, while interest out of Europe was sufficient to keep the price action buoyant above USD $1,260. A break through broad resistance at USD $1,260 - 1,263 saw a modest stop run and the session high of USD $1,265.30 printed, however the move was well offered and as such short lived as New York opened for business. The stronger than expected U.S. job vacancies data soon put an end to the bid tone, seeing the greenback turn sharply higher and with it gold collapsed through mild bids around USD $1,260, all the way to a USD $1,251.70 low before underlying support emerged. Reports that North Korea has already achieved the miniaturization of nuclear weapons and President Trump's "fire and fury" comment pulled the metal off the canvas late in trade, closing around USD $1,260 to surprisingly end with a modest gain on the session. Gold largely uncoupled from the greenback during Asian trade today, instead falling back to its position as a safe-haven asset following North Korea's comments regarding Guam. It was a generally orderly ascent for bullion today, punctuated by a brief stop loss run through Tuesday's high print, before piggybacking on a leg lower to USD/JPY as Europe began to filter in. The key for the metal in sustaining the bid tone will be a break through the USD $1,270 - $1,275 resistance level, keeping in mind that in recent times such geopolitical based moves have fizzled out, therefore the metal may need to rely on broad based USD weakness to sustain this move (focus on Friday's U.S. CPI). Platinum has continued to rally over the past 24 hours, pushing toward levels not seen since mid April as President Jacob Zuma narrowly survives a no confidence vote, while palladium is attempting to break above USD $900 once again. Data today includes U.S. MBA mortgage applications, Nonfarm productivity 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 3 Aug 2017

MACRO: US equities were narrowly higher as the Dow pushes through 22,000 for the first time. Apple provided the biggest catalyst for the Dow's record posting, shares in the worlds largest publicly listed company surged 4.73% after reporting stronger than expected results and iPhone sales. The stock is up over 30% in 2017. The Dow added 52.32 points, or 0.24%, to 22,016.24, the S&P 500 inched up 1.22 points, or 0.05%, to 2,477.57, and the Nasdaq edged lower 0.29 points, to 6,362.65. There were wins for information technology (+0.49%) while telecoms (-1.33%) led the laggards. European shares were lower, The EuroSTOXX lost 1.63 points, or 0.43%, to 378.63, the German DAX shed 69.81, or 0.57%, to 12,181.48, the London FTSE 100 declined 12.23, or 0.16%, to 7,411.43. Choppy session in the currency majors as investors eagerly await Friday's NFP data, the US dollar index slipped 0.18% to 92.874, USD/JPY was down to 110.33, while the EUR traded as high as 1.1898, it's highest level since Jan 2015. US treasury yields were higher, the 2 year yield increased 1.79 bps to 1.3590%, the 10-year yield ticked up 1.42 bps to 2.2674%. In commodities news, oil markets rallied as Brent firmed 0.95% to $52.27 and WTI rose 0.73% to $49.52. Base metals were broadly higher, with aluminium (+1.00%) leading the way higher. In US economic data, the ADP advised private payroll growth rose by 178k jobs in July following an upwardly revised 191k increase in June. The number was a little short of economists prediction of a 190k rise. The Mortgage Bankers Association advised total mortgage application volume fell a seasonally adjusted 2.8% last week. Total volume was 22% lower than the same week last year, attributed to much lower levels of refinancing. In Asia today, as I write the Nikkei sits at -0.35%, the Shanghai composite is at -0.24%, the Hang Seng at -0.15%, and the ASX S&P 200 at -0.17%. Tonight we have Markit services PMI, ISM non-manufacturing, factory orders, and weekly jobless claims out of the US; and retail sales, Markit composite and services PMI's, and the ECB Economic Bulletin out of the Eurozone.

PRECIOUS: Volatile session for the precious complex overnight. Gold jumped up to $1270 just after the open in Asia before drifting to $1265 as USD/JPY firmed through the morning. The SGE premium was around $4 over loco London and flows were limited through the day. The market was subdued through London AM, as NY opened and the weaker than expected ADP employment numbers were released we saw the yellow metal dip briefly to the days low and rebound strongly to test $1270 as the dollar slumped against the yen. High of the day came in at $1272 but there were too many sellers at this level and the XAU ended up at $1266 at the close. Silver provided most of the drama for the session, sweeping to $16.88 after the open in Asia before immediately dropping 30c to $16.58. The grey metal mirrored gold from here, a drop to the session's low on the NY open followed by a fleeting rally and a close lower at $16.56. Palladium broke the $900 psychological barrier but was unable to consolidate, while platinum closed marginally higher after a relatively quiet session compared to the rest of the precious complex. The Philadelphia gold and silver index lost 1.28%. The SPDR Gold Trust holdings were unchanged at 791.88mt. Some early action in today's trading, Gold seeing a gap lower to $1259 about an hour after the market opened in Asia. The market recovered above $1260 and has traded a $3 dollar range for the remainder of the day. The SGE premium is relatively unchanged at $4-5 and flow-wise it has been fairly quiet after the early action. The yellow metal sits at $1262.30 as I write. Silver has traded the $16.48-58 range all day, the grey metal is at $16.52 as I write. PGM's are flat.

 

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 July 2017

MACRO: US equities were mixed on Thursday, with the Dow closing at a record high while the tech sector took a beating. Tech was higher initially as Facebook shares surged on some better than expected quarterly results. The downturn, however, was swift as investors seized the opportunity to take profits. The Dow added 60.61 points, or 0.28%, to 21,771.62, the S&P 500 slipped 2.41 points, or 0.10%, to 2,475.42, and the Nasdaq dropped 40.56 points, or 0.63%, to 6,382.19. The Nasdaq was as low as 1.6% down during the session but was able to pare at least some of the losses. There were wins for telco (+5.2%) and energy (+1.0%) while tech (-0.82%) and healthcare (-0.68%) led the laggards. European shares were lower, The EuroSTOXX lost 0.42 points, or 0.1%, to 382.32, the German DAX shed 93.07, or 0.75%, to 12,188.50, the London FTSE 100 declined 9.31, or 0.12%, to 7,378.0. In the currency markets, the US dollar rose 0.27% to 93.931, USD/JPY was as high as 111.66 through the day but was sold off sharply during NY hours, the EUR traded down to 1.1654. US treasury yields were higher as investors continue process the Fed's comments from Wednesday, the 2 year yield increased 0.79 bps to 1.3631%, the 10-year yield ticked up 2.32 bps to 2.3103%. In commodities news, the oil market rally continued as inventories decline, Brent firmed 1.26% to $51.61 while WTI added 0.82% to $49.15. Base metals were mixed, with nickel (+0.90) the best performer. In US economic data, durable goods orders jumped 6.5% in June on the back of large orders from the airline industry, excluding planes and autos orders rose only 0.2%. Core capital goods orders, considered a key measure of business investment, fell 0.1% in June, the first fall since December last year. Retail and wholesale inventories grew by a seasonally adjusted 0.6% in June. The Commerce Department reported that the advanced trade in goods fell by 3.7% in June to $63.9bln, the smallest deficit since December. The Chicago Fed's national activity index firmed to 0.13 in June from a downwardly revised -0.30 in May. Initial jobless claims rose 10k to a seasonally adjusted 244k in the week ending July 22. New claims have been below 300k for 125 straight weeks, the longest streak since the early 1970's. Continuing jobless claims increased to 1.96M. In Asia today, as I write the Nikkei sits at -0.69%, the Shanghai composite is at -0.09%, the Hang Seng at -0.69%, and the ASX S&P 200 at +1.53%. Tonight we have GDP, employment cost index, and the University of Michigan consumer sentiment index out of the US; Business confidence, consumer confidence, industrial sentiment, services sentiment, and economic sentiment out of the Eurozone; plus inflation data from Germany.

PRECIOUS: Gold opened in Asia near the previous sessions high and traded up to 6 week high $1264. The SGE premium was at $7 over loco London and we saw the metal range-bound through the remainder of the day and London's morning session. The yellow metal reached a new high following NY open but was sold down to the session's low of $1255 as better than expected US economic data pushed bond yields higher and put pressure on the market. A short rally as the greenback was sold sharply against the yen was followed by a drift below $1260 before the close. Silver saw good support during London AM hours and was squeezed to a a fresh month-high $16.80. Profit taking had the grey metal dumping 20c in an hour before drifting a further 10c to close at the low of $16.53. Platinum closed relatively flat after some volatility during NY hours while palladium was once again the sessions best performer, closing up 0.8% despite a sell-off from the intra-day high of $880. The Philadelphia gold and silver index lost 2.41%. The SPDR gold trust holdings fell 0.45% to 791.88 metric tons. In today's trading, we have seen a thus far quiet session for the precious complex. Gold has remained within a tight $3 range around the $1260 level in fairly thin volumes, with the SGE premium unchanged around $7 over loco London. The yellow metal is 1258.80 as I write. Silver is edging lower, the grey metal sits at $16.52 as I write. Yesterday's best performer is faring the worst in Asia today, palladium is down almost 1% off the open and is at $869 presently. The positive economic outlook in the US is capping the precious at the moment, however Gold looks well supported ahead of the 100 dma at $1249 and a consolidation above $1260 could support a move higher.

 

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 8 Aug 2017

MACRO: The latest sanctions placed on North Korea by the United Nations Security Council has elicited a response from the rouge nation, threatening retaliation and saying that the United States will "pay for its crime thousands of times". North Korea's foreign minister, Ri Yong-ho later echoed this sentiment at the Association of Southeast Asia Nations, with U.S. Secretary of State Rex W.Tillerson in attendance. Mr Ri noted that, "Neither shall we flinch even an inch from the road to bolstering up the nuclear forces chosen by ourselves unless the hostile policy and nuclear threat of the U.S. against the DPRK are fundamentally eliminated," Consumer credit in the U.S. increased by USD $12.4 billion during June (exp: USD $15.75 billion), down on a USD $18.29 billion increase during May. Auto and student loans, generally referred to as non-revolving credit, increased by USD $8.3 billion to mark the smallest increase since mid 2016, while revolving credit, including credit cards added USD $4.1 billion, a reduction from USD $6.9 billion in May. The average net charge-off rate for large U.S. card issuers, which is the percentage of outstanding debt that issuers write off as a loss, increased to 3.29% during Q2, the highest level in four years. Another session and another record close for the DJIA on Monday, booking a ninth consecutive record close and tenth consecutive gain for the longest such run since February. The bourse was able to survive early session weakness to end +0.12% higher at 22,118.42 points, booking the 35th record close for 2017. Broad based gains led by consumer staples (+0.72%) and technology (-0.59%) saw the S&P 500 end +0.16% higher at a record closing level of 2,480.91 points, while the Nasdaq Composite surged +0.51% to end the session at 6,838.772 points. Comments from Federal Reserve officials on Monday saw U.S. treasury yields lower, with both St. Louis Fed President James Bullard and Minneapolis Fed President Neel Kashkari running a dovish narrative. Bullard, a nonvoting member and a known dove, commented that "The current level of the policy rate is likely to remain appropriate over the near term," Kashkari turned focus to the employment situation, noting that he is yet to see businesses increase wages in-line with the supposed shortage of skilled labour. Treasury yields were sold to see the 10-year around 1.1bps lower to 2.26% and the 2-year eased 0.4bps to 1.355%. Oil futures reversed much of Friday's gains on Monday, however saw interest late in trade flatter the copybook. Concerns leading into the OPEC meeting in Abu Dhabi weighed upon the price action to see WTI close around -0.5% lower at USD $49.39 per barrel (session low of USD $48.54), while Brent crude limited declines to just -0.1% to finish at USD $52.22 per barrel. German industrial production surprisingly contracted during June according to recent data, falling -1.1% MoM (exp: +0.2%) to follow a +1.2% gain previously. The fall marks the first negative monthly print this year and sees the annualised figure drop to +2.4% YoY (exp: +3.7% YoY) from +4.8% YoY previously. The disappointing figure weighed upon German equities as the Dax ended the session -0.33% lower, while regional equities weren't immune as the Stoxx Europe 600 closed -0.14% down. In the U.K. on Monday, strong performances to mining stocks, broadly driven by gains to iron ore prices and a softer sterling saw the FTSE 100 close +0.27% higher at 7,531.94 points, the best result for the bourse since June 2.

PRECIOUS: Following Friday's fireworks in the U.S., the precious complex took some time out to consolidate during Monday's session and largely ignored geopolitical headlines to track sideways with the USD. Asian trade was a non-event as bullion held a narrow USD $2 range, while we saw a brief period of weakness in early Europe take the metal to a USD $1,256 session low as the euro regained the 1.180 handle. Dovish commentary out of the Fed underpinned bullion in New York, however gold was unable to garner enough support for a move through the broad resistance level around USD $1,260 - $1,263, softening into the close to end generally flat for the session. Asia saw another range-bound session on Tuesday, however gold did see a mild bid bias as a result of modest declines to the USD. Firming CNY and CNH buoyed bullion once Shanghai opened in Asia to underpin a move toward USD $1,261, however in similar fashion to New York on Monday, the metal saw solid offers restrict any further gains. Monday's dovish Fed commentary has stalled the Greenback's recovery and allowed gold to pull away from key support levels. However, should the metal head toward the USD $1,255 - $1,250 support levels, we are likely to see weak long positioning liquidate to test further support at USD $1,240 and below this even USD $1,226. There are still a number of Federal Reserve officials due to hit the wires this week that main give bullion some direct on the way to Friday's U.S. CPI print. Platinum has been able to consolidate well above USD $960 and should see further support on the back of the Russian sanctions, while palladium reversed course on Monday following news that South African parliament will vote in secret on a motion of no confidence in President Jacob Zuma following the sacking of finance minister Pravin Gordhan in March. Palladium surged nearly +2.5% from Monday's low print and is currently positioned for a push through USD $900. Data today includes German trade data, U.S. small business optimism and the U.S. JOLTS report.

 

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 2 August 2017

MARKETS/MACRO: Competing themes and mixed data saw varied moves across markets overnight. U.S. stocks closed higher on the first trading day of August, as the Dow Jones industrial average approached another milestone of 22,000 (21,990.96 high). On the day the Dow advanced +72.8 points, or +0.33%, to 21,963.92, the S&P500 rallied +6.05 points, or +0.24%, to 2,476.35 and the Nasdaq crept up +14.815 points, or +0.23%, to 6,362.938. The best performing sector intra-day were the financials (+0.8%), while healthcare ( -0.22%) slipped. European equity indices gained as investors monitored decent earnings reports (BP, Rolls-Royce, Royal DSM) and data showed rising economic growth in the Euro-zone. The FTSE Euro First 300 Index pushed up +9.27 points, or +0.62% to 1,493.90 and the Euro Stoxx 600 gained +2.41 points, or +0.64% to 380.26. Crude oil prices were weaker (Sep WTI -$1.04, or -2.07%, to $49.13), as investors awaited evidence that global markets were re-balancing. A survey on Bloomberg showed the market’s expectations are for another strong rise in output from Libya and OPEC. All eyes will also be on this week’s EIA report, with another large draw down in inventories expected. Foreign exchange markets were fairly steady with the USD consolidating in a narrow band. Whilst Euro area growth was solid (+2.1% YoY), it had little effect on the EUR, EURUSD spending most of the session between 1.1800-1.1830. Yields firmed overnight as a raft of economic data decreased recent bullishness on the US economy. The US 10y yield decreased -4.3bps to 2.2514% and the US 2y yield fell -0.6bps to 1.3431%.

A fair bit of data to digest overnight. In the U.S. the Fed’s preferred measure of inflation, the price index for PCE, was flat in June from the prior month, the second straight flat reading. It was up +1.4% in June from a year earlier and has dropped for four consecutive months on an annual basis, from a +2.2% read in February. Core PCE was up +0.1% in June as expected for the second straight month. Core prices stabilised at +1.5% from a year earlier, which is down from +1.9% in February and notches below the Fed’s 1.7% EOY projection. Markit's U.S. manufacturing PMI rose to 53.3 in July (53.2 expected) from 52 in June. Chris Williamson, Markit's chief business economist, said the majority of indicators, including employment and buying activity, ticked up in July, though some only slightly. Elsewhere the Institute of Supply Management (ISM) said its index of national factory activity fell to 56.3 (56.4 expected) from 57.8 the month earlier. The employment index fell to 55.2 from 57.2, expectations cooled for a reading of 55.1, new orders dropped to 60.4 from 63.5 and prices paid rose to 62.0 from 55.0. Consumer spending in the U.S. rose a tepid +0.1% for the month of June in line with expectations. Personal income was flat (+0.4% expected), held back in part by a drop in the income households earn on dividends from investments according to the Commerce department. Across the pond the first reading of second-quarter GDP growth in the Euro-zone came in at +0.6% QoQ and at 2.1% YoY. This was in-line with market expectations and slightly ahead of +0.5% growth in the first quarter.

PRECIOUS: Gold traversed a $10 range overnight either side of $1270, ultimately closing right where it started the day at $1269. It was a dull day in Asia trading a few dollars lower after the Ecomex open before stabilising around $1268.00-8.50 into the SGE open. Some very modest buying was seen from SE Asian names round this time, although there remained good supply at and above $1270 which capped things throughout the Asian day. European traders dragged the gold lower, as the positive Euro GDP print was released and equity markets rallied. At the NY open there was a sharp sweep lower ($1263.00 low) but this reversed just as quickly as the 10y bond yield made a hasty decline from the days high's. The soft PCE data from the U.S. helped strengthen the gold, giving it the drive to trade through $1270 to a peak of $1274. Opportunistic sellers still linger on rallies and cap moves higher, the yellow metal edging lower into the close to round out the day back at $1269. Volumes remain fairly light across all precious metals over the past few sessions as we sail deeper into the summer doldrums.

Elsewhere, the London Bullion Market Association (LBMA) and the London Precious Metals Clearing Limited (LPMCL) yesterday released aggregated data on gold and silver inventories sitting in London vaults (loco London gold and silver), in a move towards greater transparency. The publication of vaulting statistics marks the first step, which will eventually be enhanced further by trade reporting that is set to also be published later on. At the end of March according to the publication, around 7,449 tonnes (239.49 million oz) of gold and about 32,078 tonnes (1,031.32 million oz) of silver were sitting in London vaults. That is the equivalent of roughly $300bn and around $17bn, respectively. The platinum / palladium ratio remains near the lows trading between 1.03-1.11 over the past 2 months. Platinum continues to underperform fuelled by negative comments on diesel vehicles, while demand for palladium has remained robust on supply side concerns.

There was some extreme volatility in the metals this morning, led by silver in the illiquid period prior to Tocom and the SGE opening for business. The white metal initially opened at $16.72 and shot sharply higher about an hour into the session, reaching a peak of $16.95 in about a minute or so. It seemed like a single buyer in the SIU7 contract which aggressively paid the market, perhaps gunning for stops up around $17 in the thin conditions. If this was the plan, decent supply was seen ahead of this however, and we did not stay long above $16.90 or $16.70 for that matter, the silver falling as low as $16.60 in the half hour proceeding the initial rally. Some demand began to flow in from private banks around the lows and stabilised things in the $16.60's. Gold followed silver on the move hitting a high of $1271.00, before retreating all the way through the opening levels and down towards $1265. That was most of the excitement for the day, all the metals consolidating towards the bottom of their daily ranges into the afternoon. In other markets, equities are mixed as write, the Nikkei up 0.40% and Hang Seng +0.3%, while the Shanghai Composite and ASX200 lag, down -0.25% and -0.5% respectively. Crude continued to spill lower, down marginally on day so far at $48.70 a barrel (-0.15%, or -$0.09) and the USD is a touch stronger, most markedly vs. the AUD (+0.25% at 0.7948) and JPY (+0.2% at 110.55). On the data calendar today look out for Euro zone PPI and U.S. mortgage applications and ADP employment data.

 

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 July 2017

MARKETS/MACRO: U.S. stocks traded higher overnight on the back of strong company earnings (Coke / Boeing / AT&T / U.S. Steel) and following the Federal Reserve's decision to keep interest rates unchanged. The Dow Jones Industrial Average rose +97.58 points, or +0.45%, to 21,711.01, the S&P500 inched up +0.70 of a point, or +0.03%, to 2,477.83 and the Nasdaq rallied +10.573 points, or +0.16%, to 6,422.747. European equity markets also kicked higher thanks to some robust earnings reports (Lonza / Peugeot / Commerzbank / Kion). The Euro First 300 Index jumped +7.12 points, or +0.48% to 1,504.02 and the Euro Stoxx 600 advanced +1.97 points, or +0.52% to 382.74. Regionally the FTSE100 tacked on +0.24%, DAX +0.33% and CAC40 +0.56%. Crude surged higher on the back of another strong draw down in inventories (WTI +$0.83, or +1.73% to US$48.72). EIA data showed the U.S. stockpiles of crude oil fell by 7.21 million barrels last week, which was much greater than expectations. They are now sitting at 483 million barrels, the lowest level so far this year. Gasoline inventories also fell (-1.02 million barrels to 230.2mb), suggesting demand remains strong. U.S. crude oil production also fell for the first time since June, down 19k b/d to 9.41m b/d. The better than expected data was further supported by comments from OPEC that it would increase adherence to the production cut agreement. On the FX front the USD broadly lost ground as the market interpreted the FOMC decision and statement as dovish leaning. The Dollar Index fell -0.4% to 93.67 with EURUSD gaining an impressive +0.8% to 1.1730. USDJPY fell -0.6% to 111.20 and AUDUSD, which slipped in Asia yesterday after the softer than expected headline Q2 CPI report (+0.2% vs +0.4% expected), managed to regain all the losses and closed +0.9% higher for the day at just above 0.80 - the highest level since May 2015. U.S. treasuries rallied into the close after the FOMC policy meeting concluded, with the 2y note falling -3.47bps to 1.3551% and the 10y yield whacked -4.82bps to 2.2872%.

The US Federal Reserve left interest rates unchanged as expected yesterday, but it softened its language on inflation and hinted that it would begin balance sheet reduction in September (changing the wording around timing from “this year” to “relatively soon”). The former is a dovish development, but the latter is less clear cut. On the one hand, balance sheet reduction will tighten US financial conditions, but to the extent that balance sheet reduction and low inflation delay rate hikes, it does mean that policy rates in the US will be low for longer. Against a backdrop of softening inflation, the market also appears to be reading it as a bit aggressive (ie. will be a drag on US growth), with the USD sold heavily and bonds rallying on the news. It certainly seems that the Fed is keen to press on and unwind QE regardless. As expected, Fed officials voted unanimously to leave their benchmark rate in a range between 1.00% - 1.25%.

In other economic news, new home sales in the U.S. gained +0.8% (+0.8% expected) to a seasonally adjusted annual rate of 610k units last month (615 units expected). The sales pace for March, April and May was revised lower. New single-family homes sales in the West soared +12.5% to their highest level since July 2007. They jumped +10.0% in the Midwest, but fell -6.1% in the South. Sales were unchanged in the Northeast. At the current sales pace, there was a 5.4-month supply of new homes on the market at the end of June. There were 272k new homes available for sale, the highest level in 8 years.

PRECIOUS: Gold remained fairly soft into the FOMC decision yesterday, with weak longs happy to square up ahead of the announcement and suppress the price to sub $1250 levels throughout. Once the decision dropped however, the language in the statement, particularly the change from 'this year' to 'relatively soon', was perceived by the market as decidedly dovish. USD and bond yields fell rather dramatically in the final few hours of trade, which benefitted the metals complex. In Asia the yellow metal teetered around the $1250 mark ultimately falling through this level as Japanese traders came on line. There was some sizeable bids on Ecomex around $1249.50 (spot equivalent) of 100+ lots which kept the market buoyant for the first few hours, but Japanese sellers quickly pushed through the support and the gold fell sharply towards $1247. Au managed a modest recovery back towards $1248-49 by the time China walked in, but they too were net sellers which saw the market gently angle lower into the afternoon. The $1243.80 low was hit during early London trade, with some light support beginning to emerge under $1245. Just ahead of the FOMC announcement, the yellow metal was trading just beneath $1250 when the USD dived sharply. Gold surged to $1255 in the aftermath, did a little work there, then took off through the previous highs at $1258.50-9.00, with stops being tripped to a top of $1263.30. $1260 was then held into the close, which is certainly a positive on the daily charts and could potentially mark a breakout. Silver performed well also, losing ground in line with gold throughout the Asia/London sessions and bouncing back through $16.50 following the FOMC. Gold's very impulsive rise throughout July now sits it above the 61.8% Fibonacci retracement (Jun-Jul decline) at $1262, however it does appear technically there will be some resistance between $1265-75.

The metals held onto their overnight gains during the Asian session today, although there was a definite pause in the action post FOMC. Interestingly there was some light follow through Chinese buying on the day despite the higher prices, as well as some TOCOM bids which kept spot gold steady. The SGE premium subsided with higher prices, onshore gold trading at around $6-8 premium when compared to the loco London price. In other markets equities where in the black, the Nikkei up is +0.15%, Shanghai composite +0.05%, Hang Seng +0.6% and ASX200 +0.15% at time of writing. Crude is flat on the day as is the USD with the exception of AUDUSD, which continues to push higher currently sitting at 0.8043. Elsewhere, India eased the restrictions for its Sovereign Gold Bond Scheme after failing to secure the targeted investment last year. The annual investment limit under the Scheme has been raised to 4 kilograms for individuals and 20 kgs for trusts - the previous limit was 500 grams. The cabinet has also empowered the finance ministry to launch variants of Sovereign Gold Bonds with different interest rates, risk protection and pay-offs, to compete with alternative investments and deal with volatility in global gold prices. On the data calendar today look out for U.S. jobless claims, durable goods orders, wholesale inventories and Chicago Fed Activity index, as well as German retail 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 : Monday 7 Aug 2017

MACRO: The U.S. economy added 209k jobs during July to outpace expectations centered around 180k, while June saw an upwards revision to 231k (prev: 222k) and May softened marginally to 145k (prev: 152k). The July gains were led by a 53k increase across bars and restaurants, while professional and business services added 49k payrolls and healthcare increased by 30k jobs. The unemployment rate eased to 4.3% (exp: 4.3%) from 4.4% previously, however the broader 'U-6' measure of unemployment and underemployment, which includes those who have stopped looking and those in part-time jobs who want full-time positions, held at 8.6%. The labour force participation rate ticked up ever so slightly to 62.9% from 62.8% in June. Wage growth inched up +0.3% MoM to hold the annualised increase at +2.5% (exp: +2.4%), while the average working week was also unchanged at 34.5 hours. The DJIA continued to push into record territory on Friday following the robust jobs report, booking an eighth consecutive record close and also an intraday record after ending on the high print. The bourse added +0.3% to 22,092.81 points, finishing the week with a +1.2% rise and the fourth positive weekly result in the past five. Gains to financials (+0.72%) and materials (+0.48%) saw the S&P 500 to a +0.19% gain for the session and around +0.2% higher for the week, while the Nasdaq Composite added +0.18% on Friday, however booked a -0.4% weekly decline. Oil futures turned higher on Friday following the U.S. payrolls print, while a modest decline to the active U.S. oil rig count underpinned the bid tone throughout afternoon pricing. Active oil rigs in the U.S. eased by 1 to 765, while those drilling for gas pulled back by 3 to 189. WTI jumped over +1% to end around USD $49.58 per barrel, however on a weekly basis the U.S. benchmark slipped -0.3%. Brent crude meanwhile settled at USD $52.42 per barrel for a +0.8% gain, trimming the weekly decline to around -0.4%. The stronger U.S. payrolls print gave the greenback a boost on Friday, bouncing off a near 15-month low to see the DXY index end +0.8% higher. In the largest single session percentage gain since January 18, the dollar posted notable gains against the euro and the yen to end the week modestly higher. Markets across Europe posted gains on Friday, buoyed by the U.S. jobs report and a softening common currency against the greenback. The Stoxx Europe 600 bounced +0.95% to 382.53 points, seeing the weekly result to +1.1% for the first week-on-week gain in three. In Germany the Dax jumped +1.18% after seeing support from a +1% MoM increase to manufacturing orders in June, while the French CAC 40 surged +1.42%. Equities in the U.K. turned higher on Friday after seeing support from an ailing sterling, taking the FTSE 100 +0.49% higher to mark the best close in six weeks.

PRECIOUS: The solid U.S. payrolls print and a leg higher to the greenback saw the precious complex under pressure on Friday, putting an end to three consecutive weekly gains for gold. The yellow metal tracked a relatively narrow range into Friday's U.S. figures, as offers broadly around resistance at USD $1,270 kept a lid on any attempted move higher. The outperformance of the U.S. jobs market soon had the greenback turning higher against majors, and with it bullion pulled away from USD $1,270 to test support around USD $1,260 - $1,263. A brief period of respite above USD $1,260 soon gave way to a further leg lower as the euro collapsed through 1.1800 (1.1728 low) after being with sight of 1.1900 during European trade. Support around USD $1,255 restricted further gains during afternoon pricing, while bargains hunters pushed the metal to a close just underneath USD $1,260 for a -0.75% decline on the session. ETF flows recorded on Friday show the funds bailed on around 140k ounces as bullion slumped. Following Friday's lively price action, Asia disappointed to kick of the week in a soft fashion, as gold tracked sideways amid muted interest. Bullion opened around USD $1 lower than Friday's closing level, with modest offers in early trade keeping pricing sub USD $1,258 for the majority of the morning. A mild bid tone out of Shanghai (on-shore premium above USD $6) coupled with a marginally softer greenback saw the yellow metal test around USD $1,259 pre-Chinese lunch, however the interest didn't return after the break and Europe opened to the metal once again underneath USD $1,258. With analysts increasing the odds of a December rate hike in the U.S. following Friday's jobs report, we are likely to see bullion trade under pressure over the near-term while the market seeks out further directional cues. Initial resistance for the metal sits broadly around USD $1,260 - $1,263 (Friday's support), while weakness will seek out support at USD $1,255 and the key pivot point of USD $1,250. The latest COTR updates shows a solid increase in long gold positioning that may weigh upon price action should the metal head toward the USD $1,255 - $1,250 support levels. Silver was back to its volatile best in New York on Friday night, collapsing a staggering -2.7% following the jobs data, as spec longs awaiting a short squeeze flocked to the exits disappointed. The latest COTR data shows net length in the metal increasing on a mix of short reduction and long positioning, however this has likely changed following Friday's pricing with longs battered and bruised. The metal should see some interest toward USD $16, however should gold continue to slide, we may see USD $15.75 - $15.50 targeted. Platinum continues to advance on the back of Russian sanctions, however was subject to some weakness during Asian hours today, while palladium suffers from a softening forward market and looks likely to test lower following losing touch with USD $900. Data releases today includes German industrial production, U.K. house prices and U.S. consumer credit.

 

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 1 August 2017

MACRO: White House communications director Anthony Scaramucci was removed from his position on Monday, reportedly at the request of new chief of staff John Kelly. In a short statement the White House noted, "Mr Scaramucci felt it was best to give chief of staff John Kelly a clean slate and the ability to build his own team. We wish him all the best." Mr Scaramucci had been in the role for just 11 days. U.S. Pending Home Sales outpaced expectations during June, jumping +1.5% MoM (exp: +1.0%) to follow a modestly upwardly revised -0.7% fall in May (prev: -0.8%). The June print reversed three consecutive negative results, seeing support from a +2.9% gain in the West, a +2.1% increase in the South, while the Northeast added +0.7% and the Midwest lagged to ease -0.5%. On an annualised basis pending sales increased +0.7% YoY to match June's upward revision (prev: +0.5%). The Chicago PMI declined to 58.9 during July (exp: 60.0) from a three year high in July of 65.7. The new orders component slipped 11.6 points to 60.3, marking the lowest level since February, while production declined 6.9 points to 60.8, the lowest level since April. Equities in the U.S. again ended mixed on Monday, as the DJIA pushed to a fresh record, while the broader market faced headwinds from a heavy tech sector. The S&P 500 was unable to recover from early session weakness, weighed down by declines to materials (-0.79%) and technology (-0.53%), closing the session -0.07% lower at 2,470.30 points. The DJIA continued to break records on Monday, adding +0.28% to a fresh record close of 21,891.12 points after touching an intra-session record high of 21,929.80 points. Declines to Facebook (-1.86%), Google (1.34%) and Amazon (-3.16%) kept the Nasdaq Composite underwater, seeing the bourse -0.42% down at the close. Over the month the S&P 500 added +1.9%, the DJIA gained +2.5% and the Nasdaq jumped +3.4%. Oil futures ripped higher late in trade on Monday, erasing early session declines on the back of supply concerns out of Venezuela. The U.S. Treasury announced on Monday afternoon sanctions against Venezuelan President Nicolas Madura following Sunday's vote that gives the Government the power to change the country's constitution. WTI jumped through USD $50 per barrel on the way to a +1% gain and the highest close since May 24, while Brent crude added +0.3% to settle at USD $52.65 per barrel. Over the month of July the U.S. benchmark gained +9%, while Brent crude jumped +9.9%. Markets across Europe kicked of the week generally lower, with stronger than expected data out of the Eurozone seeing the euro close above 1.1800 for the first time since January 2015. Inflation data out of the region held at +1.3% YoY (exp: +1.3%), while core CPI edged higher to +1.2% YoY (exp: +1.1%) from +1.1% previously. The Stoxx Europe 600 closed -0.11% lower, with industrial and tech shares under pressure, while the German Dax handed back -0.37%. In the U.K. the FTSE 100 outperformed regionals even amid a strengthening pound, buoyed by gains to commodity related stocks to end +0.05% higher.

PRECIOUS: Further broad USD weakness underpinned bullion on Monday to see gold consolidate last week's gains and hold a narrow range throughout the session. Uncertainty surrounding personnel movement within the Trump administration and EUR/USD above 118.00 added further support to the precious complex, seeing gold once again above USD $1,270 in New York following some late Asian profit taking test toward USD $1,265. Asian trade on Tuesday saw mixed interest around the USD $1,270 pivot point, continuing to suffer from a lack of regional physical interest as the Shanghai premium held toward USD $5, while Indian demand holds flat to see price action dictated by spec flows. Upcoming key technical levels for the USD with regards to both DXY and currency majors, in particular the euro, are likely to dictate price action over the short term and all eyes will turn to these levels for precious direction. Gold has held USD $1,265 in recent sessions, however key supports extend toward USD $1,260 and below this $1,255. A sustained break higher will need to consolidate above USD $1,280 for a test of the recent high prints around USD $1,296 - $1,298 to illicit interest for a sustained move above USD $1,300. Silver continues to push higher, albeit in a volatile fashion, looking to squeeze large short positioning as the grey metal edges toward USD $17. A break through USD $17 will open up targets at the 100 DMA of USD $17.08 and the 200 DMA of USD $17.13, putting further strain on shorts and likely to facilitate price action that may extend as far as the May high around USD $17.75. With regards to the white metals, platinum is piggybacking interest in gold to test resistance at USD $950, while a tightening palladium forward market is propelling the metal toward resistance at USD $900, with the 2017 high of USD $928 firmly within its sights. Data tonight includes U.K. House Prices, Markit Manufacturing PMI from Italy, France, Germany, the Eurozone and the U.K., as well as German Unemployment and Eurozone GDP. Out of the U.S. we see Personal Income / Spending, PCE, Markit Manufacturing PMI, ISM Manufacturing, ISM Prices Paid and U.S. 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 : Wed 26 July 2017

MACRO: The U.S. Federal Housing Finance Agency (FHFA) reported their house price index increased +0.4% MoM during May (exp: +0.5%), taking annualised growth to +6.9%. Meanwhile the S&P CoreLogic Case-Shiller national house price index increased +0.1% MoM during May (exp: +0.3%) to see the YoY growth at +5.69% (exp: +5.80%). Consumer Confidence in the U.S. surged higher during July according to the latest report from the conference board. The consumer confidence index jumped to 121.1 (exp: 116.5) from 117.3 previously, marking the highest reading since 2000. The headline print was supported by an increase to the present situation index to 147.8 from 143.9 previously, while the expectations index pushed higher to 103.3 from 99.6 previously. Equities in the U.S. pushed higher on Tuesday, however the broader market saw gains tempered somewhat by a -5.05% fall to 3M Co. following softer than expected earnings results. Positive results to McDonald's Corp. (+4.75%) and Caterpillar Inc. (+5.88) helped to off-set the 3M related declines and see the DJIA +0.47% higher at 21,613.43 points. The S&P 500 saw gains to financials (+1.27%), energy (+1.26%) and materials (+1.16%) support the bourse +0.29% higher to 2,477.13 points, while the Nasdaq Composite managed to eke out a +0.02% gain to post a fresh record closing high, however saw declines to Google-parent Alphabet (-3%) restrict further gains. Oil futures rallied on Tuesday ahead of the EIA supply report on Wednesday, with the American Petroleum Institute estimating a fall of 10.2 million barrels. WTI added around +1% to settle above USD $48 per barrel, while Brent crude traded through USD $50 per barrel on the way to a +0.8% gain. Treasury yields pushed higher on Tuesday following the positive consumer confidence read, taking 10-year close to 8bps higher at 2.333%, while two-year yields added 3.3bps to 1.389%. Business confidence in Germany unexpectedly increased during July according to IFO survey results released on Tuesday. The business climate index jumped to 116.0 (exp: 114.9) from 115.2 previously, while both the expectations and current assessment indices reported solid gains. The positive survey results helped to see the German Dax +0.45% higher, while a softer euro underpinned a +0.41% return for the Stoxx Europe 600. Equities in the U.K. ended trade on Tuesday firmly higher (U.K. FTSE 100 +0.77%), supported by strong gains to oil companies and miners on the back of stronger Chinese demand.

PRECIOUS: Dollar strength and position squaring leading into Wednesday's FOMC meeting saw gold under pressure on Tuesday, notably offered during early European trade to test the USD $1,250 support. Early Asian session weakness was well absorbed across Comex, seeing the yellow metal reverse the downward trend and test toward Monday's USD $1,258 high in afternoon flows as USD/JPY slipped below 111.00. The bid tone was however soon extinguished as European participants filtered in, seeing the metal retrace the Asian session gains and test a break of USD $1,250 leading into New York hours. Higher treasury yields and a push toward 112.00 for USD/JPY kept bullion under pressure in New York, while it is worth noting that there is decent open interest at the USD $1,250 Comex strike, which more than likely restricted the yellow metals recovery. ETF holdings further weighed upon bullion on Tuesday, with 241k ounces of outflows recorded. Asian pricing on Wednesday saw gold extend Tuesday's weakness, losing touch with the USD $1,250 handle in early pricing to slip underneath both the 50 and 100 day moving averages. Chinese interest was modest in early Shanghai trade, however while the on-shore premium continues to sit around USD $6 over loco London gold, bullion struggled to find the drivers for an afternoon recovery and sits languishing underneath the aforementioned moving averages as Europe begins their day. The technical break during Asian trade today saw some participants heading for the exits as we near the FOMC rates announcement and it is difficult to see gold making any headway above USD $1,250 leading into the Fed. A hawkish tone from Yellen today will open up a test toward the 200 DMA around USD $1,229, while a dovish skew is likely to see a recovery test USD $1,258 - $1,262. Silver saw whippy price action on Tuesday, collapsing to a dollar driven USD $16.24 low in European trade before a likely short covering rally and bid base metals (notably copper) saw a sharp reversal through the recent high of USD $16.60. The grey metal eased into the close, however was able to consolidate gains to end modestly higher on the session. There was further turbulence for silver during Asian trade today, with the metals inability to hold USD $16.50 seeing a break toward USD $16.30, where we saw supportive interest on Tuesday. Silver looks to have the greatest upside should the Fed turn dovish today, with the record high short positioning expected to come under pressure if the metal can break through USD $16.69. All eyes tonight on the FOMC rates decision and accompanying release, while leading into this we see U.K. GDP and U.S. New 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 4 Aug 2017

MACRO: Initial jobless claims in the U.S. fell by 5,000 to a seasonally adjusted 240,000 (exp: 243,000) during the week ended July 29. The print saw the four-week moving average ease 2,500 to 241,750, while the number of continuing claims during the week ended July 22 increased 3,000 to 1.968 million (exp: 1.958 million). Factory orders in the U.S. jumped +3.0% during June (exp: +3.0%), reversing two months of declines to mark the largest gain since October 2016. The headline print was supported by a +131% increase in orders for civilian aircraft, while orders excluding transportation dipped -0.2% to follow an upwardly revised -0.1% (prev: -0.3%). Durable goods meanwhile surged +6.4% during June (exp: 0.0%), however excluding transportation, goods inched just +0.1% higher to follow a +0.2% gain previously. The Institute for Supply Management's measure of the U.S. services sector fell sharply during July, touching an 11-month low of 53.9 (exp: 56.9) to follow 57.4 previously. Declines to employment and new orders weighed upon the headline print, offset marginally by an increase to prices paid. Equity markets in the U.S. once again ended mixed on Thursday, seeing the DJIA to a seventh consecutive record close, while the broader market saw weakness across the energy sector as crude prices softened. The DJIA continued to push into uncharted territory on Thursday, adding +0.04% to close at a record of 22,026.10 points, however saw gains tempered somewhat by declines to Apple (-1.00%). The S&P 500 ended the session -0.22% lower at 2,472.16 points, seeing weakness from energy (-1.34%) and materials (-0.72%) weigh upon the headline figure, while the tech heavy Nasdaq Composite slumped -0.35% to close at 6,340.341 points. Oil futures reversed early session gains on Thursday as the recent bid tone softened leading into the OPEC meeting next week. WTI ended the session just over -1% lower at USD $49.03 per barrel, while Brent crude slipped -0.7% to settle around USD $52 per barrel. Thursday's Bank of England meeting saw the central bank un-surprisingly hold interest rates unchanged at 0.25%, however noting that they anticipate raising rates at a faster pace than investors expect. The central bank voted 6-2 to keep rates on hold, while unanimously agreeing to keep the size of the government and corporate bond portfolio at GBP 445 Billion. There were however dovish data out of the meeting with the 2017 GDP forecast cut to 1.7% from the 1.9% predicted in May, while the 2018 forecast was pulled back to 1.6% from 1.7% previously. European equity markets ended mixed to generally eke out modest gains on Thursday amid choppy trade, seeing the Europe Stoxx 600 add +0.1% to 378.93 points, the French CAC jumped +0.5%, while the German Dax disappointed to ease -0.2%. In the U.K. a softening sterling on the back of the BOE meeting supported equities higher, taking the FTSE 100 to a +0.9% gain.

PRECIOUS: Gold recovered from early Asian weakness on Thursday following a soft New York close, buoyed by a pull back to U.S. yields and a softer greenback to end the session toward the recent resistance around USD $1,270. Thin early Asian trade saw gold briefly below USD $1,260 in a similarly whippy fashion to silver's turn higher the session prior, however solid bids restricted any further declines and the metal was able to recover and hold the figure throughout the session, generally range bound leading into U.S. hours. Softer than expected U.S. data supported bullion in New York, seeing the USD take a further leg lower as USD/JPY broke below 110.00 and gold tested USD $1,270 to end with a +0.6% gain. Asian interest on Friday was relatively subdued leading into the U.S. payrolls data, with a lack of physical interest the main drag on the price action as bullion eased away from USD $1,270 during Chinese trade, however underlying bids were evident to restrict further declines. Price action leading into the all important U.S. Nonfarm payrolls release is expected to be muted, while the key determinant for direction will likely fall to the USD, which currently sits on a number of key support levels in DXY terms as well as against the euro and yen. Silver followed gold higher during U.S. hours on Thursday, supported by an ailing greenback to once again push through USD $16.70. The grey metal continued the bid tone during Asian hours on Friday, with underlying interest toward USD $16.65 keeping the price action buoyant and seeing the metal positioned for a test of USD $17.00 should tonight's U.S. data disappoint and see short positioning exit. With regards to the white metals, platinum was able to push through the USD $950 resistance in New York and hold the level during Asian hours today, while palladium saw good lending in the forward market weigh upon further gains as the metal pulled away from USD $900. All eyes tonight on the U.S. Nonfarm payrolls figure, while leading in to the figure we see German Factory orders.

 

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 31 July 2017

MACRO: Gross Domestic Product in the U.S. expanded at a +2.6% QoQ annualised during Q2 (exp: +2.7%), while Q1 growth saw a downwards revision to +1.2% QoQ (prev: +1.4%). A jump in consumer spending to +2.8% (exp: +2.8%) underpinned the headline figure as Americans purchased more groceries, clothes and paid more for healthcare. U.S. core PCE, which excludes the volatile food and energy categories, increased +0.9% QoQ (exp: +0.7%) to follow +1.8% previously. The University of Michigan's measure of consumer sentiment (final) increased to 93.4 during July (exp: 93.2) from a preliminary read of 93.1. The figure was however down on June's 95.1 as the expectations index touched an 8-month low to weigh upon the headline print. U.S. equities ended trade on Friday mixed, with a slump in technology stocks, in particular Amazon (-2.48%) weighing down the broader market. The S&P 500 ended the session -0.13% lower at 2,472.10 points, seeing declines to consumer staples (-0.91%) and consumer discretionary (-0.74%) offset robust trade in healthcare (+0.50%). The DJIA outperformed the broader market to reverse early session declines and end at a fresh record of 21,830.31 points for a +0.15% gain. Meanwhile the Nasdaq Composite (-0.12%) saw weakness from Amazon after the giant reported a -77% decline in second-quarter earnings. Oil prices continued to march higher on Friday, largely ignoring the latest U.S. oil rig count and instead extend the strong weekly performance. WTI settled just underneath USD $50 per barrel to book a +1.4% session gain and take the weekly return to +8.6%, while Brent crude jumped +2% to book a +9.1% gain over the week. The soft U.S. GDP release on Friday saw the greenback trade lower for the third consecutive week, seeing the DXY index touch the lowest level since mid-2016. The greenback is down close to -9% in 2017, while the euro continues to rally, jumping through 1.1750 on Friday to the highest level since early 2014. In Europe, stocks traded under pressure on Friday as technology and financials weighed upon regionals. The Stoxx Europe 600 ended the session -1.04% lower to book the weakest close since April 21, with the oil and gas sector booking the only positive move. In the U.K. declines to British American Tobacco and Imperial Brands saw the FTSE 100 -1.00% lower following reports that the U.S. Food and Drug Administration plans to lower nicotine levels in cigarettes to non addictive levels.


PRECIOUS: Softer than expected data out of the U.S. and further weakness to the greenback supported precious prices on Friday. Muted Asian and European trade into the U.S. GDP print saw gold offered toward USD $1,260, however it wasn't long until the metal broke above the figure as the USD took a further leg lower in New York. The flight into safety saw further support from reports of another North Korean missile test, seeing bullion briefly above USD $1,270 late in trade, ending the session toward the high for a +1% gain. Asia kicked off the week with an early bid tone to see gold briefly through Friday's high print as the USD tracked lower, however the metal soon pulled back in Chinese trade as the Shanghai on-shore premium continues to stifle interest and hold toward USD $5. The Comex Aug/Dec roll is now out of the way and may remove some of the support from the market, while the latest COTR shows an increase in gold positioning, largely a result of short covering. Gold will look to hold support around USD $1,260 to position for a further advance toward resistance at USD $1,280. Silver could see some further volatility in the coming days as the metal trades broadly around the downtrend from the 2016 high print, while a break through USD $17 will open up targets at the 100 DMA of USD $17.08 and the 200 DMA of USD $17.13. Although reduced marginally last week, silver short positioning continues to hold around the all-time high and we could see further lightening of shorts should the metal test toward USD $17. With regards to the white metals, palladium forwards tightened last week to take the metal close to +4.5% higher and we have seen further bids in the market during Asian trade today. Data releases tonight include German Retail Sales, Eurozone Unemployment, Eurozone CPI, the Chicago PMI out of the U.S. and U.S. Pending 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 : Tuesday 25 July 2017

MACRO: Saudi Arabia has announced that it will go beyond production cuts and begin limiting exports in an attempt to reduce the global oil glut. Saudi Arabian energy minister Khalid al-Falih announced on Monday that the oil rich nation will curb exports to 6.6 million barrels per day in August, a reduction of 600,000 barrels per day from the 7.2 million averaged during January through May this year. Following the OPEC meeting on Monday it was announced that Nigeria and Libya, both of whom were exempt from last year's production cuts will have production limits put in place. Nigeria has agreed to limit daily production to 1.8 million barrels per day, underneath their current production level of 1.6 million barrels per day, while Libya will be capped at 1.25 million barrels per day, however still well above June's 820,000 barrels per day production. IHS Markit reported improved conditions across the U.S. manufacturing sector during July, taking the manufacturing PMI index (provisional) to 53.2 (exp: 53.2) from 52.0 previously. Improving demand saw increases to output, new orders and employment support the headline figure higher, while the services PMI index (provisional) held unchanged at 54.2. Equities in the U.S. once again ended mixed on Tuesday, with the broader market turning lower as investors traded with caution into both a busy week of earnings and the upcoming FOMC policy meeting. The DJIA pulled back -0.31% to end the session at 21,513.17 points, weighed down by further weakness to General Electric (-1.85%). Gains to financials (+0.31%) and technology (+0.25%) were unable to overturn weakness across telecoms (-1.02%) and utilities (-0.96%) as the S&P 500 ended trade -0.11% lower, while continued interest in tech stocks saw the Nasdaq (+0.36%) outperform to book its 41st record close of 2017. Markets in Europe traded under pressure on Monday, sliding lower following data from Markit showing the Eurozone manufacturing sector softened during July. The Stoxx Europe 600 ended the session down -0.2% to see its lowest close in two-weeks, while the German Dax saw weakness across autos to end -0.3% off the pace. Equities in the U.K. were dragged lower by airline stocks on Monday, falling around -1% to 7,377.73 points.


PRECIOUS: The precious complex kicked off the week with mixed price action, seeing gold print a near four-week high before easing late in trade to book the first decline in seven sessions. Early Asian interest saw bullion break above Friday's New York high on a modest stop loss run, however the bid tone soon tempered leading into the Shanghai open, seeing gold ease below USD $1,255 in search of support above USD $1,250 as the USD caught a bid into European hours. After seeing solid interest toward the USD $1,250 support the yellow metal turned higher during early European trade, once again breaking above USD $1,255 to print a fresh session high of USD $1,258. Interest around the New York open saw gold spike through USD $1,258 to a session high of USD $1,259.35, however offers around the USD $1,260 resistance put an end to any further gains as the metal consolidated around the USD $1,255 pivot point into the close. Asian trade on Tuesday mirrored Monday's price action, with gold forced to test support toward USD $1,250 in early flows, before the metal reversed course as USD/JPY fell below 111.00. Bullion generally tracked USD flows throughout the session, however struggled to find support for a test of Monday's high print in afternoon trade, with participants likely restricting positioning leading into the U.S. rates decision this week. Gold continues to consolidate above USD $1,250, with support sitting underneath at the 50 and 100 day moving averages broadly between USD $1,248 - $1,249.50. A break through USD $1,260 will see targets on the top-side for gold extend to USD $1,275 - $1,280, while moves beyond this will look to the April and June high prints around USD $1,296 - $1,298. After testing support toward USD $16.40 late in Asian trade on Monday, the grey metal followed gold sharply higher into New York hours to print a fresh near three-week high of USD $16.58. Late session weakness saw the metal dragged below USD $16.50, while Asian trade on Tuesday saw interest around the figure keep the price action in a relatively tight range, generally influenced by USD flows. Broad support extends below USD $16.40 (USD $16.35 - $16.40), while a sustained move through USD $16.50 to target USD $16.69 should drive short liquidation to support further gains. Data releases today includes German IFO survey results, U.S. FHFA House Prices, the Conference Board U.S. Consumer Confidence and the Richmond Fed Manufacturing 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.