Gold Marks 5 Month Highs on Geo-Political Concerns
$GLD, $SLV, $SLW, $EXCFF, $GDX
Gold rose about 2% to a fresh 5-month high Tuesday as investors sought safe havens from risk on mounting political and security concerns over North Korea, the Middle East and the French election.
Spot Gold was up 1.53% at 1,273.44 oz by 3:10p EDT after hitting a session high at 1,275.16.
US Gold futures ended the session 1.6% higher at 1,274.20.
Geopolitical events have seen Gold break through the Key resistance at 1,260, Silver prices also improved, but Gold was the chief beneficiary of the safe haven buying that emerged.
Investors also bought the Japanese Yen (JPY) and US Treasuries, while The US Dollar (.DXY) Index fell and stocks took a small hit on the day.
The Fed plans to raise U.S. interest rates gradually so as to sustain healthy growth without letting the economy overheat, Fed Chair Janet Yellen said Monday. Rising interest rates lift the opportunity cost of holding non-yielding bullion, this has not cooled the appetite for Gold
From a technical viewpoint
Gold broke above the Key resistance at its 200-Day MA, fueling more buying. Let’s see if it can hold it now.
Holdings of SPDR Gold Trust (NYSEArca:GLD) , the world’s largest Gold-backed exchange-traded fund, rose 0.21% to 838.26 tonnes Monday from 836.49 tonnes Friday.
Spot Silver was up 2.1% at 18.294 oz after marking 17.71 Monday.
Platinum rose 2.8% to 962.55 oz, after hitting its weakest in over 3 weeks at 931.85 Monday. The spread between Gold and Platinum hit its highest since October 2016 at $318.23.
Palladium rose 2% to 804.05 after touching its weakest in more than a week at 784.72 in the prior session.
Note: There is more geopolitical risk at the moment and that is more positive Gold than Platinum and there is no surprise in that sense to see the spread widen. Platinum is used in catalysts in diesel-powered vehicles, which are going out of favor with consumers in the EU and USA.
The above fundamentals taken together add up to a strong case for Gold, Silver, shares of the major Gold miners, and the royalty streamers like Metalla and Silver Wheaton
Overall, my work makes a strong case for the prices precious metals to continue to rise over the long term.
|HeffX-LTN Analysis for GLD:||Overall||Short||Intermediate||Long|
|Neutral (0.24)||Bullish (0.34)||Bullish (0.31)||Neutral (0.06)|
|HeffX-LTN Analysis for SLV:||Overall||Short||Intermediate||Long|
|Bullish (0.29)||Neutral (0.20)||Bullish (0.29)||Bullish (0.39)|
|HeffX-LTN Analysis for GDX:||Overall||Short||Intermediate||Long|
|Neutral (0.15)||Neutral (0.23)||Bullish (0.29)||Neutral (-0.07)|
|HeffX-LTN Analysis for SLW:||Overall||Short||Intermediate||Long|
|Neutral (0.19)||Neutral (0.23)||Bullish (0.29)||Neutral (0.06)|
|HeffX-LTN Analysis for EXCFF:||Overall||Short||Intermediate||Long|
|Neutral (0.17)||Neutral (-0.08)||Neutral (0.15)||Bullish (0.44)|
The US Financial markets are closed for Good Friday, have a terrific Easter Weekend.