DAILY REPORT : Tuesday 27 Mar 2018

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

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

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

 

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

DAILY REPORT : Wed 21 Mar 2018

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

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

 

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

 

DAILY REPORT : Thursday 15 Mar 2018

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

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

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

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

 

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

 

 

DAILY REPORT : Monday 26 Mar 2018

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

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

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

 

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

DAILY REPORT : Tuesday 20 Mar 2018

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

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

 

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

DAILY REPORT : Wed 14 Mar 2018

MACRO: In Trump related news, the President announced a shake-up of his administration, replacing secretary of state Rex Tillerson with C.I.A. director and former Tea Party congressman Mike Pompeo. Mr Tillerson at times clashed with the President on key issues, notably Russia's alleged involvement in U.S. elections. Headline CPI in the U.S. increased +0.2% MoM in February (exp: +0.2%) to follow a +0.5% increase the month prior, while on an annualised basis prices rose +2.2% YoY (exp: +2.2%) from +2.1% previously. Softer gasoline prices weighed upon the headline figure, with prices -0.9% lower over the month following January’s +5.7% gain. The so called ‘core’ CPI that excludes the volatile food and energy components increased +0.2% MoM (exp: +0.2%) to follow a +0.3% increase in January, while on an annualised basis core inflation held at +1.8%. Equity markets in the U.S. ended lower on Tuesday as technology and financial sectors weighed upon the major bourse's, while participants largely ignored White House movements. The DJIA ended the session -0.68% lower at 25,007.03 points, while technology (-1.21%) weighed upon the S&P 500 to have the bourse -0.64% lower at 2,765.31 points. The greenback reversed Asian gains following the U.S. inflation data as interest rate expectations softened somewhat. The DXY index pulled back -0.25% against majors, paring early session gains against the yen after the pair pushed above 107.00. Treasury yields eased to see the 10-year around 2bps lower to 2.84%, while the two-year slipped less than 1bps to 2.254%. Oil futures traded lower on Tuesday, seeing whippy price action in New York as traders turned focus to Wednesday's EIA report, with expectations of a third consecutive weekly rise in U.S. crude supplies. WTI was the hardest hit and ended trade around -1% lower at USD $60.70 per barrel, while Brent crude slipped -0.5% to USD $64.60 per barrel.

PRECIOUS: A mixed session for bullion during Asian trade on Wednesday, softening modestly in early session flows, before Chinese interest stepped in to see the metal through the New York high print. Early gains to the greenback against the yen in Japan saw the yellow metal ease below USD $1,325, however the metal soon reversed course on the back of USD/China weakness as the on-shore premium held around USD $8 relative to London pricing. A test toward USD $1,330 leading into the Shanghai lunch break ran into a wall of offers to restrict further top-side gains, however once the far East returned after the break, gold pushed, albeit unconvincingly, through the figure to print a session high of USD $1,330.30. Early European offers capped any further attempts through the figure, as profit taking in conjunction with a mildly bid greenback saw gold retrace the majority of Asian session gains to end flat on the session. Offers toward USD $1,330 and broadly beyond this between USD $1,335 - $1,340 remain formidable resistance levels for bullion, however conversely the metal continues to find layered bids underneath USD $1,320, with extensions toward USD $1,310. Near-term price action should remain with the recent range, leaning toward a sustained break higher once ETF's awaken from their recent slumber and Asian physical demand picks up as we move through the typically muted March flows. Data releases today include German CPI figures, Eurozone industrial production, U.S. retail sales and U.S. PPI.

 

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

DAILY REPORT : Friday 23 Mar 2018

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

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

 

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

DAILY REPORT : Monday 19 March 2018

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

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

 

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

DAILY REPORT : Tuesday 13 Mar 2018

MACRO: US equities were mixed ahead of tonight's CPI data release, with buoyancy in the tech sector helping the Nasdaq to a fresh record high. The Dow lost 157.13 points, or 0.62%, to 25,178.13, the S&P 500 fell 3.55 points, or 0.13% to 2,783.02, while the Nasdaq gained 27.514 points, or 0.36%, to 7,588.325. There were wins for REITs (+0.49%) and utilities (+0.42%) while industrials (-1.17%) and health (-0.44%) led the laggards. European equities were mostly higher, the EuroSTOXX put on 0.96 points, or 0.25%, to 372.71, the German DAX added 71.71 points, or 0.58%, to 12,418.39, and the London FTSE 100 slipped 9.75 points, or 0.13%, to 7,214.76. In the currencies, the US dollar index lost 0.23% to 89.89, the EUR traded up to 1.2341, while USD/JPY traded down to 106.34. US treasury yields were mixed, the 2 year yield was unchanged at 2.2589% and the 10 year yield eased 3.12 bps to 2.8626%. In commodities, oil markets were lower on concerns over increasing US output, Brent dipped 0.79% to $64.97 while WTI fell 1.11% to $61.35. Base metals were broadly lower, with aluminium (-1.37%) the biggest loser. In US economic data, the monthly budget deficit rose to $215 billion in February, an increase of 12% from the same month last year. Revenues were $156 billion, down 9% from February last year, while outlays increase 2% to $371 billion. Withholding taxes were 2% lower which analysts are attributing to the Trump administration's tax cut. In Asia today, as I write the Nikkei is at +0.06%, the Shanghai composite is at -0.23%, the Hang Seng at -0.27%, and the ASX S&P 200 is at -0.47%. Tonight we have NFIB small business index, consumer price index, and core CPI data out of the US.

PRECIOUS: The precious had a relatively quiet session ahead of the US CPI data release scheduled for tonight. Gold traded a tight range between $1321-24 in Asia, with the $8 SGE premium prompting sporadic buying out of China. The market started to slip on the London open, the EUR dipped below 1.23 during the AM session and the yellow metal was sold to the days low of $1315. The EUR recovered as NY came in, the resulting USD sell-off propelled gold steadily higher through the remainder of the day. The metal closed all but flat at $1322. Silver was quiet also, dipping to a low of $16.44 in London before closing level. Palladium had a tough session, giving back the previous days gains to finish at $978. The Philadelphia gold and silver index added 0.98%. The SPDR gold trust holdings were unchanged at 833.73 metric tonnes. In Asia today, gold ticked up a couple of dollars early on but has drifted lower as the day progresses. The SGE premium remains around $8 but there has not been enough buying action to support the market in the face of a sharply rising USD/JPY. The yellow metal was as low as $1318.90 and is at $1320.20 as I write. Silver has eased off the open and sits at $16.49 as I write. PGM's are flat. All eyes on the US tonight for the CPI data release, the effects of which should flow through to the precious complex. Gold should find initial support at $1314-15 and the key technical $1300 level below that. On the topside, expect first resistance around the 55 DMA at $1327 followed by the March high $1340 level.

 

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

DAILY REPORT : Thursday 22 Mar 2018

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

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

 

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

DAILY REPORT : Friday 16 March 2018

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

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

 

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

DAILY REPORT : Monday 12 Mar 2018

MACRO: U.S. jobs data released on Friday showed nonfarm payrolls surged by 313,000 in February (exp: 205,000), while January saw an upwards revision to 239,000 from 200,000 previously. The participation rate edged higher to 63.0% (exp: 62.7%) from 62.7% previously, average hourly earnings increased +2.6% YoY to follow a modesty downwardly revised +2.8% gain in January (prev: +2.9%), while hours worked inched higher to 34.5 hours from 34.4 previously. The unemployment rate held at 4.1% (exp: 4.0%) and 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 was unchanged at 8.2%. Equity markets in the U.S. ripped higher on Friday following the bullish jobs data, seeing the DJIA close back above 25,000 points for the first time since Feb 28. The bourse added +1.77% to 25,335.74 points to end +3.3% higher on the week, while strength across financials (+2.48%), industrials (+2.17%) and technology (+2.03%) led the S&P 500 +1.74% higher to 2,786.57 points, a +3.5% gain on the week. The greenback eased modestly on Friday following softer than expected wage growth in the U.S. however was able to book onto a third consecutive weekly gain.

PRECIOUS: The precious complex began the week in quiet fashion, holding a narrow range throughout the day while seeing underlying support from the far East. Early price action saw bullion drift lower from Friday's closing levels, as Tocom opened to an early offered bias and the dollar remained firm. Shanghai opened to an on-shore premium toward USD $8 and provided support to the spot market, seeing bullion add around USD $3 to move above USD $1,324, while headlines regarding Japanese Prime Minster Shinzo Abe's wife and a cronyism scandal let to mild risk aversion in the afternoon to weigh upon USD/JPY. Gold is likely to continue to run into offers around USD $1,330 (50 DMA) over the near term as participants adjust following Friday's strong U.S. jobs data, while an easing of tensions on the Korean peninsula should strip the metal of some lingering risk premium. Supportive price action should remain broadly between USD $1,302 - $1,312 as participants look to the metal to push higher over the medium-term, while respecting the USD $1,300 - $1,340 range over the near-term. With regards to the white metals it is worth noting the palladium held the 200 DMA of USD $964 perfectly last week and his since added over +3.3% from the level. A close above USD $1,000 will likely be required to encourage a further leg higher, however participants should be encouraged by light positioning, currently sitting toward the lowest level since 2016.

 

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.