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Precious Metals Review

Market information and news is critical for precious metal investing. However, many investors have limited time to sort through the massive amounts of market data and gold, silver and platinum news. The Monex Precious Metals Review consolidates the week's activities in a concise snapshot of the precious metal markets.

PRECIOUS METALS REVIEW - January 17, 2020
In the precious metals markets this week...
GOLD

The Monex AM closing price on Friday was $1,560, up $6 for the week. Monex spot gold prices opened the week at $1,554. . . traded as high as $1,561 on Friday and as low as $1,541 on Tuesday. Gold support is now anticipated at $1,550 then $1,538, and then $1,516. . . with resistance anticipated at $1,565, then $1,592, and then $1,606.

SILVER

The Monex AM closing price on Friday was $18.08, up $.08 for the week. Monex spot silver prices opened the week at $18.03. . . traded as high as $18.12 on Friday and as low as $17.74 on Tuesday. Silver support is now anticipated at $17.88, then $17.64, and then $17.49. . . and resistance anticipated at $18.15, then $18.31, and then $18.53.

PLATINUM

The Monex AM closing price on Friday was $1,025, up $47 for the week. Monex spot platinum prices opened the week at $978. . . traded as high as $1,034 on Thursday and as low as $966 on Monday. Platinum support is now anticipated at $1008, then $991, and then $964. . . and resistance anticipated at $1,030, then $1,055, and then $1,087.

PALLADIUM

The Monex AM closing price on Friday was $2,386, up $267 for the week. Monex spot palladium prices opened the week at $2,119. . . traded as high as $2,453 on Friday and as low as $2,103 on Monday. Palladium support is now anticipated at $2,330, then $2,290, and then $2,240. . . and resistance anticipated at $2,400, then $2,455, and then $2,520.

Browse our video library and discover incredible precious metals market insights through informative expert interviews and frequent updates directly from Monex. https://www.monex.com/video-library/
QUOTES OF THE WEEK...
From Sara Toy in 1/16 Wall Street Journal Dollar Forecast to Fall and Life Commodities

''A softening dollar could give commodity prices a boost this year.

After a year in which a strong dollar weighed on commodity prices, some banks predict the dollar is set to weaken in 2020, dragged down by expectations that the Federal Reserve will hold interest rates at low levels. Lower interest rates make a currency less attractive to investors, as they offer lower rates of return.

That could herald good news in 2020 for investors already betting that easing trade tensions between the U.S. and China and a pickup in global growth will lift demand for commodities like metals and crude oil.

'When there's weakness in the dollar, the usual response is to pick up things that are priced in dollars,' said Twi Wong, head of base and precious metals derivatives trading at Bank of Montreal.

Major moves in commodity prices are often sparked by fundamental factors, such as fears of a supply shortage or issues that could affect demand. Those moves can be sharpened or damped by movement in the dollar.

In the past three months, commodity prices have climbed as the WSJ Dollar Index has slipped 1.9% from its 2019 high in September.

Both copper futures and U.S. crude futures have climbed more than 9% during that time, and gold futures recently traded at their highest level since 2013.

The Bloomberg Commodity Index has gained 2.1% in the past three months.

Cooling trade tensions between the U.S. and China have also weakened the dollar and boosted commodities in recent weeks.

After months of negotiations, the world's two largest economies announced in December they had reached a limited trade agreement. Both sides signed the deal on Wednesday.''

...And From Yun Li in 1/15 www.cnbc.com The World's Largest Hedge Fund Sees Gold Rising 30% to $2,000: 'There is so much boiling conflict'

''Gold prices, which briefly topped $1,600 last week, could rally to $2,000 an ounce amid heightened political risks, Bridgewater's co-chief investment officer Greg Jensen told the Financial Times Wednesday.

The manager from the world's biggest hedge fund cited increased income inequality in the U.S. and rising tensions with China and Iran as uncertainties ahead that will prompt more safe-haven buying. Bridgewater manages $160 billion in assets, more than any other hedge fund.

'There is so much boiling conflict,' Jensen told the paper. ''People should be prepared for a much wider range of potentially more volatile set of circumstances than we are mostly accustomed to.''

Jensen also believes the Federal Reserve would let inflation run hot for a while, which also creates an environment for higher gold prices as investors tend to use the precious metal as a hedge against inflationary forces.

Spot Gold rose 0.3% to $1,551.40 per ounce on Wednesday, after crossing the $1,600 mark and hitting a seven-year high last week. The U.S.-China trade war and the Middle East unrest drove investors to more conservative investments for its stability during times of tumult, pushing gold prices higher.

Earlier last year, founder of Bridgewater Ray Dalio advocated putting money into gold as he saw a ''paradigm shift'' in investing due to global central banks' expected moves to an easier monetary policy.

The Federal Reserve cut interest rates for three times last year to combat a slowing economy. Jensen said it's possible the central bank could slash rates to zero this year to avoid a recession and disinflationary pressures.

Bridgewater is not alone in recommending the bullion. DoubleLine CEO Jeffrey Gundlach also said last year he was a buyer of gold on expectations that the dollar would weaken.''

...And From Lisa Beilfuss in 1/10 Barron's The Job Market is Booming. For Some.

''The U.S. labor market was undeniably strong in 2019, marking its 10th straight year of job gains. That doesn't mean there aren't cracks beneath the surface.

U.S. employers hired a solid 145,000 workers in December and unemployment remained at a half-century low, at 3.5%, data released Friday by the Labor Department showed. While hiring slowed from November's robust pace, economists by and large expect job gains for the foreseeable future, even if they moderate from an average of 174,000 a month over 2019.

It's a lonely endeavor to argue that the job market isn't quite as rosy as it seems at a time when analysts and investors are celebrating record job creation. Things have clearly gotten a lot better since the dark days of the financial crisis and recession. But lost in the headlines and historical sweep is the reality that for many Americans, this job market isn't as strong as it looks.

It makes sense, when you step back and think about it. Gross domestic product has been running at about 2%, low compared with rates of growth in past economic cycles. 'The economy is barely running lukewarm,' says Calvin Schnure, a former Federal Reserve economist who now works at the National Association of Real Estate Investment Trusts, referencing the gap between the picture the labor market paints and the broader economy.

One problem with the monthly, aggregated Labor Department reports, according to Pantheon Macroeconomics' chief economist Ian Shepherdson, is that they don't tell the whole store and aren't reflecting what the experience is like for a lot of people. 'It's a good economy for the best educated,' Shepherdson says, with the divergence between that cohort and everyone else largely unaddressed.

To get a deeper view of the current labor market, Barron's looked at about two dozen employment metrics. Plenty are strong. But others show there are some caveats to the narrative that the American job market is going gangbusters.

Consider workers' wages. The big mystery, Shepherdson says. Is why this long spell of job growth hasn't translated into higher pay. ''I can't imagine it's ever going to be better than now to ask for a raise,' he says, and yet employers hiring in December managed to add working while paying wages that rose at the slowest pace since August 2018.

There's one explanation for sluggish wage growth that is obvious yet crucial for investors to remember. Jobs remain concentrated in lower-paying service-sector positions, where pay gains in some industries, such as education and health care, are running below overall wage growth and hardly keeping up with even tepid inflation. Many service jobs pay much less than goods-producing jobs, and the U.S. economy's shift to one dominated by the service sector continues.

There are other places where it's evident that the job market is a bit less hot than headlines suggest. Take the rate of prime-age labor-market participation, which is still trending a bit below historical levels. While some of that is due to an aging population, the current rate suggest there might still be prime-age people shut out of the workforce. The participation rate of those ages 25 to 54 stands at 82.9%, below the 83.1% at the start of 2007 and the 84.1% at the start of 2001.

Another metric to consider: While unemployment is at a 50-year low, the duration of unemployment for those who want a job and don't have one is still higher than precrisis levels.

None of this is to say the job market will meaningfully weaken soon, especially given the Federal Reserve's assurance that it intends to hold rates steady this year. But investors might consider looking under the labor market's hood.''



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This is not a recommendation to buy or sell.

Last update: Jan 17, 2020 11:09:54 AM

This is not a recommendation to buy or sell.