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Energy & Precious Metals – Investor.com’s weekly and previous calendar review


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By Barani Krishnan

Investment.com – Is gold on its way to $ 1,800 an ounce?

And will it continue to advance from there?

Those questions are probably in everyone’s mind after Comex gold futures and spot gold both hit seven-week highs above $ 1,780 on Friday.

The resurgence of gold occurs when US bond yields fall in the context of high consumer prices, which confirms the role of the gold metal’s diminishing barrier to inflation.

The surge in sanctions imposed on Russia imposed by the United States on Thursday also brought gold back – in the eyes of some, at least – as a safeguard against political risks. The last time gold prices reacted to geopolitical situation was in January 2020 the assassination of Qassem Soleimani, Iran’s top general, who was killed in a US attack by Biden’s predecessor Donald Trump. command.

Covid-19’s outbursts following Soleimani’s assassination brought international conflicts to almost zero for the rest of 2020, until the murder of nuclear scientist Mohsen Fakhrizadeh – once also, an Iranian – in an attack involving Israeli forces. That incident hardly created a ripple in the gold market.

With President Joseph Biden taking office in January, US-Russia relations have just begun and tensions escalate in the Middle East involving Iran, Saudi Arabia, Turkey and Israel. None of these had a significant effect on gold until this week’s sanctions against Moscow.

While gold buyers are currently banking back to $ 1,800, they are probably noting that this is not their first attempt since losing that valuation threshold in mid-February. Numerous failed tests show that volatility can potentially complicate gold’s advancement and stabilization even as it reaches $ 1,800.

Sunil Kumar Dixit at SK Dixit Charting in Kolkata, India said: “The increase in closing on weekly charts confirms the continued readiness to increase to $ 1,800 – $ 1,805 and even expanding to $ 1,830.

“That said, volatility at those highs could trigger a correction that pushes gold to the $ 1,755- $ 1,730 support zone and once again brings in buyers looking for value.”

Dixit is not alone in seeing a tough time gold.

Justin Low said in a ForexLive post on Friday that gold broke resistance at $ 1,780 mainly due to a drop in US bond yields – a dynamic that may not last.

Another problem – and bigger – is the continued lack of institutional support for gold in the form of an ETF, he said.

Gold’s largest ETF, SPDR Gold Shares (NYSE :), saw its holdings drop to 32,886 million on Friday – the lowest level since April 16 last year.

“(There) continued to reflect a lack of interest and appetite for gold, which has the potential to drag prices lower,” said Low.

“The chart is favoring stronger momentum for current buyers, with deeper resistance seen near the 38.2 retracement near $ 1,785 and then the $ 1,800 level with the 100-day moving average. nearby, ”he added. “Eventually something has to deliver, and if investor desires still don’t come back significantly, gold’s latest technical rally could be quite limited.”

Metals Focus also stated that yield will be the factor that drives gold price for the rest of the year.

“While some geopolitical events are likely to escalate, including on the Ukrainian border, the more important thing for gold prices will be that the macro context remains supportive,” said metals trading adviser. know.

“Monetary and fiscal policies, including maintaining extremely low interest rates and negative real yields, and concerns about future inflation will continue to be a case of strong investment in gold in the future. near the.”

US bond yields, as measured by, hovered at 1.58% on Friday, well below the 14-month high of 1.77% on March 30.

Sophie Griffiths, UK research lead and EMEA at online brokerage OANDA, said: “It looks like the bond market is finally buying into the lower answer over a longer period of time. Fed.

Since the beginning of this year, gold has been facing headwinds as the dollar and bond yields often soar on the argument that a post-pandemic US economic recovery could exceed expectations, leading to fears of rising inflation due to the Federal Reserve keep interest rates close to zero.

Adding to the strength of gold is a weaker dollar, which often boosts the gold meta. The greenback depreciated against and five other major currencies, weakening to 91.56 from Wednesday’s settlement of 91.62.

Gold had a streak in mid-2020 when it rose from a March low of under $ 1,500 to a record high of nearly $ 2,100 in August, in response to inflation concerns caused by the bailout. The first US financing of 3 trillion USD was approved for the coronavirus pandemic.

However, the breakthroughs in vaccine development since November, coupled with optimism about an economic recovery, have forced gold to close trading in 2020 at just under $ 1,900.

This year, the situation got worse when gold first dropped to $ 1,800 in January, then fell below $ 1,660 at some point in March.

Such weakening of gold is noteworthy if considered from the point of view of the $ 1.9 trillion Covid-19 stimulus passed by Congress in March and the Biden administration plans to spend. add for infrastructure $ 2.2 trillion.

Usually, the stimulus measures lead to dollar devaluation and inflation causes gold to appreciate as an inflation hedge. But a logical sell-off has instead been on gold for the past six months, with some Wall Street banks making no comment to support these.

The price of gold increased

on Comex of New York made the last trade of $ 1,744.60 before the weekend. Gold price on the Comex floor closed Friday session down 13.60 USD, or 0.8%, at 1,744.80 USD / ounce. However, for the week, it was up 1.05%.

Gold traded at $ 1,743.94, down $ 11.68, or 0.7%. During the week, spot gold increased by 0.8%. Spot gold moves are indispensable for fund managers, who sometimes rely on it more than futures for direction.

Oil Market & Price Cycle Summary

Oil prices stabilized 6% for the week, thanks to the unexpected drop in US crude oil prices. However, the volatility could return to the market as worries about the impact of the Covid-19 variants show signs of improving fuel demand, however.

Optimistic US economic data – including spike retail sales and the start of housing and failure in unemployment – are bringing investors in oil and assets at risk. Other optimism about a better-than-expected recovery from the coronavirus pandemic.

But that confidence is also being offset by an increase in hospital visits by adolescents and young adults, many of whom carry B.1.1.7, the coronavirus variant first identified in the UK that officials public health said is currently the most common strain circulating in the United States This variant is highly contagious, thought to be about 60% more contagious than the original strain of the virus.

The issue was sufficiently related to the White House announcing on Friday that it has spent $ 1.7 billion on tracking, tracking and beating the emerging Covid-19 variants that are threatening the land’s pockets. country.

US authorities also halted this week the administration of Johnson & Johnson (NYSE 🙂 Covid-19 vaccine following reports of blood clots in recipients. Modern (NASDAQ :), meanwhile, said it would not be able to achieve its vaccine delivery target to the UK and Canada.

Ed Moya, head of US research at online broker OANDA, said that despite the week’s rise, crude prices could return to reflect “the growing risk of variations. new ”and other issues surrounding the pandemic.

That could lead to volatility returning, some market participants said.

“We’re not out of the woods yet with record highs of new infections,” said John Kilduff, founding partner at New York’s energy hedge fund Again Capital. “Any increase in the number of Covid or a setback in the vaccine could put pressure on oil prices in a new volatility.”

Trading in New York, the standard for US crude oil, last traded at $ 63.08 a barrel before the weekend. WTI settled Friday’s transaction at $ 63.16, up 33 cents, or 0.5%. For the week, it was up 6.4%, the biggest gain since the week ending February 26.

Trading in London, the global standard for crude oil, last traded at $ 66.71 a barrel before the weekend. Brent settled Friday’s transaction at $ 66.77, down 17 cents or 0.3 percent. It is up 6.7% for the week, the highest level since the week ended on January 29.

Rising oil supply-demand figures released by the US Energy Information Administration on Wednesday helped WTI break out of the week from the box at $ 57 to $ 60 and Brent break out of the range on its own. 61 dollars to 63 dollars.

The EIA reported a decrease of 5.899 million barrels in the week ending April 9, compared with analysts’ expectations for a decrease of 2.889 million barrels.

inventories rose 309,000 barrels, compared with expectations for an increase of 786,000 barrels.

Stockpiles, including diesel and, fell 2.083 million barrels for the week against expectations for a 971,000-barrel increase, EIA data showed.

Better supply-demand numbers coincide with spikes in traffic recorded in key US metropolitan areas over the past week as many of the country’s 50 states forced to open. The economy is back from the pandemic, thanks to a dynamic federal vaccine program.

The Paris-based International Energy Agency also raised its 2021 global oil demand forecast by 230,000 barrels a day to 5.7 million barrels a day. Meanwhile, the Organization of Petroleum Exporting Countries has increased its demand expectation for the year to 100,000 bpd.

Energy market calendar forward

Monday, April 19

Estimate Cushing’s private stockpiles

Tuesday, April 20

Weekly report on oil stockpiles.

Wednesday, April 21

Weekly EIA report

Weekly EIA report

Weekly EIA report

Thursday, April 22

Weekly EIA report on {{ecl-386 || natural gas storage}

Friday, April 23

Baker Hughes’s weekly survey about

Disclaimer: Barani Krishnan uses his own range of external perspectives to give diversity to his analysis of any market. As for neutrality, he sometimes gives conflicting views and market variables. He does not hold a position in the commodities and stocks he writes about.



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