Gold hit a 15-month high overnight of $1,306 an ounce, up over $13 from Friday’s spot close. Silver also hit a 15-month high, at $18.05, up 23 cents over the spot close. Spot gold is up an astronomical $66 from last Monday’s open.
The New York open saw traders jumping to lock in $57 an ounce in gains from Thursday’s open, pulling gold prices back down through $1,300 to the $1,295 range. This is still slightly above Friday’s close. The fact that gold had gained $46 over two trading sessions meant that the market was due for a pause.
June gold futures settled Friday at $1,290.50 an ounce, up $24.10 (1.9%.) This was the highest since January 2015. It capped a week where gold futures logged gains every day. Gold futures were up 4.4% for the month of April. Year to date returns for paper gold is 22%
July silver futures settled at $17.819 an ounce Friday, also a 15-month high. Paper silver notched a boggling 15.2% gain for April, and 28.96% year to date.
Technical levels for gold show $1,304 as first resistance. followed by $1,309. Support is first found at $1,294, backstopped by $1,286.
Commodities in general are being assisted this morning by continued weakness in the dollar.The Japanese yen hit a 1.5-year high versus the greenback overnight. The euro was also stronger, pushing the 1.15 mark in early trading. A decision by the Federal Reserve to not raise interest rates last week has weakened the dollar.
The U.S. government is watching the Bank of Japan’s reaction to a stronger yen. If they intervene in currency markets, the US may lodge a complaint of currency manipulation with international authorities.
Oil prices continue to ignore fundamentals, and work their way higher. WTI oil futures recorded a 19.8% gain for April, after settling at $45.92 a barrel Friday. Brent futures settled at $48.13, for a monthly gain of 21%. This was its best month in seven years.
Just like gold rose too far, too fast, profit taking hit oil prices this morning. At 11 am in New York, WTi contracts were down 1.7%. Brent futures were down 2.34% because of reports of an increase in Russian exports. A report today said that OPEC boosted production to 32.64 million barrels a day in April.
Stocks closed lower Friday. The Dow and S&P 500 both recorded a 1.3% loss for the week. This was the worst weekly drop for the Dow since mid-February, and worst since February 5th for the S&P. However, an abysmal close to April was not enough to pull the two indices into the red for the month. This Nasdaq was not as lucky, as tech shares (especially Apple) pummeled the index into the red for the day, week, and month.
Today is a light day for commodities. Shanghai, Hong Kong, and London markets are closed for holidays. This leaves New York as the only major gold hub open today.
The opinions and forecasts herein are provided solely for informational purposes, and should not be used or construed as an offer, solicitation, or recommendation to buy or sell any product