Precious Metals Fundamental Analysis – November 9 – November 13, 2015 Forecast – Gold, Silver & Platinum

Analysis and Recommendations:  The precious metals sector plunged last week following the release of a stronger-than-expected U.S. Non-Farm Payrolls report. The strength of the report suggests the economy is ready for an interest rate hike in December. 

Following the release of the report, U.S. Treasury yields rose, driving up the U.S. Dollar while pressuring gold, silver and platinum. Global investors are chasing the higher yields and the precious metals don’t pay dividends or interest, making them a less attractive investment. 

For the week, December Comex Gold futures closed at $1088.90, down $52.80, or 4.62%. December Comex Silver finished at $14.74, posting a loss of $0.7950, or 5.12%. January NYMEX Platinum lost $43.80, or 4.44%, finishing at $942.70. 

Gold posted a huge loss on Friday, following the release of the jobs report. This drove the market to a three-month low. It also helped post its biggest weekly drop in more than two years. Silver and platinum both posted their third straight weekly decline. 

Forecast 

The precious metals could see further deterioration early in the week due to the selling momentum on the close on Friday. At some point, oversold technical factors could help form a low. This would most likely be fueled by profit-taking and short-covering. 

With the jobs report out of the way, the focus will shift towards the consumer. Friday’s retail sales report will be most important. Core retail sales are expected to recover from the previous reports -0.3%. Traders expect it to rise 0.4%. Retail Sales are estimated to show a 0.3% gain versus the previously reported 0.1%. 

Softer-than-expected retail sales figures will not necessarily take a December rate cut off the board, but it could give short-sellers a chance to lighten up positions, triggering a modest short-covering rally by gold. 

Other important U.S. reports this week include JOLTS Job Openings on Thursday and Consumer Sentiment of Friday. 

China could rattle the markets early in the week when it opens with fresh CPI data. Over the week-end, it is scheduled to release trade data. At the end of the week, it will publish retail sales info. Traders want to see signs that the Chinese economy is stabilizes after several months of economic turmoil. 

Several Fed members are scheduled to speak next week, including William Dudley, James Bullard and Jeffrey Lacker, but the primary emphasis will be on Fed Chair Janet Yellen who is scheduled to give welcoming remarks at a Fed conference on Thursday. 

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. 

 

 

Major Economic Events for the week: 

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