Gold Technical Report: Gold traded in a narrow range yesterday closing with a DOJI signaling indecision. It has been on a decline mode since beginning of the new year and closed below support of 10 days Exponential Moving Average for a consecutive day, in last 15 trading sessions. Earlier it had struggled and come out of upper range maintained by the market for earlier few sessions looking poised to touch 2100 again. Recently it witnessed volatile movements when it crossed above 2100 mark upside on 4th Dec and also drifted down below 1980 on 12th Dec. The short term Stochastics Oscillator is at 33 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 53 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices also remained rangebound yesterday after a decline for five straight trading sessions earlier. Day before yesterday it breached the support of 10 days Exponential Moving Average and fell further forcefully crossing below all 50,100 and 200 days Exponential Moving Averages on closing basis in a single day. Thus it It has fully reversed the upmove of 13th Dec when it had crossed above all these averages to later hit 25.88 intra day high which now becomes the next target. The Short term Stochastics Oscillator is at 21 and Relative Strength Index near 40.
Fundamental Report: The Gold prices continue with its struggle to gain any meaningful direction and remains confined in a narrow trading band below the $2,050 level. Traders seem reluctant to place aggressive directional bets and prefer to wait for the release of the official monthly employment details from the United States (US). The popularly known Nonfarm Payrolls (NFP) report will be looked upon for more clarity on the Federal Reserve’s future policy decisions, which, in turn, will play a key role in determining the near-term trajectory for the non-yielding yellow metal. Yesterday’s upbeat US labor market reports forced investors to scale back their expectations for a more aggressive policy easing by the US central bank. The Automatic Data Processing (ADP) reported on Thursday that US private-sector employers added 164K jobs in December as against 115K expected. Adding to this, a report published by the US Department of Labor (DOL) showed that Jobless Claims fell more than expected, to 202K. This remains supportive of elevated US Treasury bond yields, which act as a tailwind for the US Dollar (USD) and cap gains for the Gold price. The downside, however, seems limited in the wake of the prevalent cautious market mood, which tends to benefit the precious metal’s safe-haven status.