Kinesis Money Macroeconomic Analysis
After an intense macroeconomic agenda over the past few weeks, the week ahead is expected to be slightly quieter, despite the initial release of jobless claim requests. There is a good chance that there will be a consolidation of recent movements, while any indications of price growth will continue to be strictly followed by the investors.
Indeed, stock trading has slowed down in the last few sessions – albeit moderately – after US prices rose by 6% last month, in line with inflation. This generated a jump in US treasuries, with the 10-year Treasury yield rising to 1.55%.
On the Forex market, the greenback achieved further gains, climbing above 95, as the EUR/USD pair is still being traded below 1.15.
Kinesis Money Gold Analysis
Gold and silver are showing fractional losses in today’s early trading session. However, the last two weeks have clearly offered a very positive signal for the precious metal sector. Therefore, today’s minor correction could still be seen as consolidation, as some investors cash in on their profit after the recent gains.
Moreover, some technical indicators, such as the RSI (relative strength index), were in a clear overbought situation and a tiny correction could help the bulls to recover strength. Of course, analysis of this retracement as modest is required to confirm this theory.
Analysing the scenario for bullion showed its clear surpass of the first resistance level placed at $1,800 before it jumped above $1,830 to then accelerate up to $1,865.
It remains that the medium-term scenario is supportive of gold. This is displayed by the first barrier placed at $1,850 and the second support placed at $1,830-1,834 – the former top for bullion.
On the other hand, a new break-up of $1,867 – $1,870 could open space for gold to reach $1,900 and eventually, $1,920 – the former record of 2011, which was surpassed in the summer of 2020.
Kinesis Money Silver Analysis
The silver rally continued on Friday, as the price rebounded to $25.4. In the month of October, silver rallied from a low of $21.2 to $25.4, strongly outperforming gold.
This week saw silver start in red, with bullion being traded just above $25. Technically, there is a strong support zone at $24.9, and a decline below this threshold can be considered as a negative signal for silver. Bulls will recover strength if the price can surpass $25.4, with space here for more recoveries and a target in the region of $25.8 – 26.
Similar to gold, the modest decline seen in the early trading session today seems to be a retracement and not yet a proper inversion.
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Carlo Alberto De Casa is an external Market Analyst for Kinesis Money.
He also writes as a technical analyst for the Italian newspaper La Stampa.
Carlo Alberto provides regular commentary for UK outlets including the BBC, Telegraph, the Independent Bloomberg & Reuters. He is also a commentator for CNBC Italy. He worked for Bloomberg as their Equity Research Fundamental Analyst before joining brokerage ActivTrades in 2011 to specialize in currency markets and commodities. In 2014 he published a book on gold and the gold market, followed by a new updated edition in 2018.
This report is not an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of future performance.