Technical Analyst, Saxo Bank
Gold spot XAUUSD is testing 0.764 Fibonacci retracement and $1,850/troy oz support. A correction is not unlikely which could take XAUUSD back to around 1,900-1,920
However, RSI is below 40 threshold and Bollinger bands still expanding indicating we could see lower levels. A move below $1,844 is likely to fuel another sell off. However, a quick dip below support to test and bounce off of rising lower trendline is not unlikely.
Weekly chart the collapse after triangle break out could test both trend lines in the triangle. If Gold breaks below both trend lines and especially the falling one selling pressure could extend below 1,800. However, when you see more than one or sometimes a cluster of Fibonacci levels it indicates strong support/resistance. 1,830 seems to be a strong support combined with the two triangle trend lines.
The price collapse in Silver spot XAGUSD seems to be close to exhaustion. The precious metal is close to $22 support. RSI is at an extreme below 20 and at a level where Silver price several times have bounced off of.
The spike yester yesterday (long lower shadow on the candle) could have been the exhaustive bear move and a correction to around 23.50 over next week or so is not unlikely.
Weekly chart illustrates the strong support area around 22.00-21.60 from where Silver is likely to bounce. However, if it experience a weekly close below thios strong support area the technical rebound picture is totally demolished and reversed
The Gold/Silver ratio XAUXAG has moved 0.618 of the peak to trough distance of the symmetrical Triangle after break out. (the two green arrows are identical in length). The ratio has been rejected at the 0.618 projection at $84. Further set back should be expected. Support at around 81. i.e. 0.382 Fibo retracement of the break out move.
Longer term the Gold/Silver is trading in a broad slightly rising channel. Indicating more upside is not unlikely.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.