Precious Metals Fundamental Analysis November 24, 2015 – Forecast – Gold, Silver & Platinum

Analysis and Recommendations:

Gold tumbled $7.70 as the US dollar soared today breaks the all-important 100 level in the Asian session. Gold is trading at 1068.60. Silver fell 196 points to break below $14 and is trading at 13.90 at this writing and remains weak. Platinum dipped $5.70 to 850.20 as markets prepare for the FOMC rate increase in three weeks. Gold extended losses on Monday, falling towards a near-six-year low reached last week, pressured by a robust dollar and upbeat comments from Federal Reserve officials on a possible U.S. rate hike next month. Spot gold had dropped 0.7 percent to $1,070.36 an ounce by 0320 GMT, down for a 13th session in the 16 trading days this month.

The metal declined to $1,064.95 last week, the lowest since February 2010. Speculation that the Fed will lift interest rates for the first time in nearly a decade this year has intensified since the release of strong U.S. jobs data earlier this month. Comments from Fed officials have boosted that view. Higher rates tend to weigh on gold, as they lift the opportunity cost of holding non-yielding assets, while boosting the dollar. “We perceive gold price at around $1,080 somewhat like a technical play, a reflection of market behavior of ‘sitting on the fence’ as they await the FOMC meeting in December,” said OCBC Bank analyst Barnabas Gan, referring to the Federal Open Market Committee.

The prospect of the first increase for almost a decade boosted the greenback, but dragged down raw materials and energy shares as the stronger dollar made them more expensive for international investors.

There is a “strong case” for raising interest rates when Fed policymakers meet next month, as long as US economic data does not disappoint, San Francisco Fed President John Williams said on Saturday. The Fed should “soon” be ready to raise interest rates as US central bankers grow confident that low inflation will rebound and that employment remains stable, William Dudley, the influential head of the New York Fed, said on Friday.

The dollar was trading near a seven-month high against a basket of six major currencies on Monday, weighing on gold.

A strong greenback makes dollar-denominated gold more expensive for holders of other currencies.

SPDR Gold Trust, the world’s top gold-backed exchange-traded fund, said its holdings fell 0.18 percent to 660.75 tonnes on Friday, the lowest since September 2008.

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:

Tuesday, November 24, 2015

Government Bond Auctions

Date Time Country

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