Gold Technical Report: Gold prices traded in a narrow range and market seemd to be in a consolidation mood. The prices retraced from intra day high and closed near 10 Day Moving Average (DMA) @ 2005 for second consecutive day. Both 10 DMA and 50 DMA @ 1919 are trading above 200 DMA @ 1799 hence, the medium term trend looks upwards. The major support stands at 200 DMA below which the trend may turn bearish. The short term Stochastics Oscillator is at 36 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 54 (it is considered overbought when above 70 and oversold when below 30) .
Silver Technical Report: The silver prices also traded rangebound and registered a green doji as it approach 12 months high. It has a strong support near the common area of 100 DMA @ 23.05 and 50 DMA @ 22.72. The medium term trend looks bullish as both of these averages above 200 DMA @ 21.33. The Short term Stochastics Oscillator is at 38 and Relative Strength Index near 64.
Fundamental Report: Gold moved up a little Thursday, mirroring the steady price action in U.S. Treasury bonds and the U.S. Dollar. After hitting a more than two-week low in the previous session, investors are now grappling with the likelihood of more interest rate hikes by the global central banks to contain inflationary pressures. The SPDR Gold Shares ETF (GLD) settled at $185.36, down $0.89 or -0.48%. As prices subsides towards sub 2000 levels, investors swiftly took advantage of the discounted price and pushed spot gold back above this crucial support level. However, gains were capped as investors remain vigilant as U.S. Federal Reserve members are expected to maintain a hawkish stance leading up to Saturday’s blackout period before the Fed’s upcoming meeting. On Wednesday, New York Fed President John Williams stated that inflation remains problematic and that the Fed will take action to address it. According to the CME FedWatch tool, the market is pricing in an 83.7% chance of a 25 basis-point hike in May. Such rate increases increase the opportunity cost of holding non-interest-bearing assets such as gold. A Reuters poll suggests that the Fed will implement a final 25-basis-point rate hike in May and then maintain interest rates for the rest of 2023. A wave of hawkish remarks from the US Federal Reserve, European Central Bank, and Swiss National Bank, coupled with persistently high inflation in the UK, have left investors rethinking their predictions for rate cuts in 2023. In March, consumer price inflation in Britain remained in the double-digit range, while euro zone inflation declined slightly but remained stubbornly high based on underlying metrics. These trends are reinforcing expectations for additional rate hikes from the Bank of England and the European Central Bank. The dollar index dipped by 0.1%, which could make gold relatively less expensive for buyers who hold other currencies.