Precious Metals Fundamental Analysis – November 23, 2015 – Forecast – Gold, Silver & Platinum

Analysis and Recommendations:

Gold gained $5.60 to 1083.60 while Silver added 43 points to trade at 14.265 and Platinum soared $6.45 to reach 864.55. Gold gained on Friday, extending the previous day’s rally, as expectations that the Federal Reserve will take its time over raising interest rates prompted a wave of short covering after prices hit near six-year lows.

The market had become overextended on the downside after falling to its lowest since February 2010 at $1,064.95 an ounce on Thursday, analysts said.

A suggestion in the minutes of the Federal Reserve’s last meeting that the bank would move cautiously on rates prompted the short covering.

Analysts attributed the rise in gold futures to a firming global trend where it held an advance from a five-year low as Federal Reserve Vice Chairman Stanley Fischer said that US policy makers have done their best to prepare international markets for the first interest rate increase since 2006.

Speculation that the Federal Reserve will lift interest rates for the first time in nearly a decade this year has intensified since the release of strong US jobs data earlier this month, which triggered a sharp drop in gold prices.

Higher rates tend to weigh on gold, as they lift the opportunity cost of holding non-yielding assets, while boosting the dollar. The Fed has telegraphed its imminent rate move so well that central bankers elsewhere have even begun to get impatient about it, its second-in-command suggested on Thursday.

Once this wave of short covering has run its course that is likely to keep up pressure on gold, which has fallen 5 percent this month and is down 8.5 percent so far this year.

“We still remain in thrall to the Fed,” Marex Spectron said in a note on Friday. “Although a lot of the possible December rate rise is factored in, the markets will still react to speeches and figures.”

Chinese banks are growing alarmed by a rising number of defaults among jewellery manufacturers, prompting them to review new gold lending more carefully, according to sources with direct knowledge of the issue.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Today’s economic releases:

 

Upcoming Economic Events that you should be monitoring:

Monday, November 23, 2015

Government Bond Auctions

Date Time Country

Nov 20 16:30 Italy Announces details of CTZ/BTPei on 25 Nov

Nov 23 12:00 Belgium Auctions OLOs

Nov 23 N/A US Holds 2-year note auction

Nov 24 17:30 Italy Announces details of BTPs/CCTeu on 27 Nov

Nov 24 N/A Holland Eur 1.0-2.0bn 0.25% Jul 2025 DSL

Nov 24 N/A US Holds 5-year note auction

Nov 25 11:03 Sweden Holds bond auction

Nov 25 11:10 Italy Auctions CTZ/BTPei

Nov 25 11:30 Germany Eur 3bn 1.0% Aug 2025 Bund

Nov 25 N/A US Holds 2-year FRN auction

Nov 25 N/A US Holds 7-year note auction

Nov 26 11:03 Sweden Holds bond auction

Nov 27 11:03 Sweden Holds bond auction

Nov 27 11:10 Italy Auctions BTPs/CCTeus