ISA Bullion Gold Report – 2 September 2024

02 September 2024
OTC Market Data
High
Low
Close
Previous
Change USD
Change %
Gold
2526
2494
2503
2521
-18.00
-0.71%
Silver
29.58
28.69
28.86
29.44
-0.58
-1.97%

Engaging Market Overview

In today’s unpredictable economic environment, gold and silver continue to serve as the ultimate safe havens for investors seeking stability amidst market volatility. With the global economy sending mixed signals and geopolitical tensions simmering, these precious metals are more than just a refuge—they are vital components of a resilient investment strategy. This report dives into the latest trends affecting gold and silver, offering you the insights needed to navigate these turbulent times with confidence.


Fundamental Analysis

Gold has extended its losses to a six-day low, slipping below the crucial $2,500 mark early Monday. This decline is largely attributed to the recovery of the U.S. dollar, which has strengthened in response to July’s Personal Consumption Expenditures (PCE) Index. Additionally, concerns over the sluggish Chinese economy, the world’s top gold buyer, are adding downward pressure on the precious metal. However, expectations of an interest rate cut by the U.S. Federal Reserve (Fed) in its September meeting may help cushion gold’s losses, as lower interest rates reduce the opportunity cost of holding non-yielding assets like gold. Investors will be closely watching the U.S. ISM Manufacturing PMI for August, due on Tuesday, followed by the Services PMI on Thursday and the all-important U.S. employment data on Friday, including the Nonfarm Payrolls (NFP), Unemployment Rate, and Average Hourly Earnings for August.

Gold:

Although the technical indicators continue to favor an uptrend, the extension of the corrective downside in gold prices could be imminent. The 14-day Relative Strength Index (RSI) is trending lower, approaching the 50 level, which signals ongoing weakness in gold prices. Sellers are targeting the immediate support at $2,470, with the next critical level at $2,450. If these levels fail to hold, a further decline towards $2,433 could be on the horizon. On the flip side, if gold buyers manage to keep prices above the psychological level of $2,500, a rally towards the recent high of $2,530 could be expected. The short-term Stochastic Oscillator currently reads 74, while the RSI stands at 57.

Support 3
Support 2
Support 1
Current Market Price
Resistance 1
Resistance 2
Resistance 3
2433
2450
2470
2498
2516
2530
2548

Silver:

Silver closed the previous session 3.24% lower, despite hitting a six-week high earlier in the month. The metal ended August with a 0.48% loss against gold. Weak demand from China, coupled with new import quotas, has created headwinds for silver. However, ongoing geopolitical tensions in the Middle East and a weakening U.S. dollar—amid expectations of a Fed rate cut—are providing some support. The short-term Stochastic Oscillator is at 58, while the RSI is at 45, indicating a potential continuation of the downtrend unless key support levels hold.

Support 3
Support 2
Support 1
Current Market Price
Resistance 1
Resistance 2
Resistance 3
28.00
28.07
28.18
28.40
28.51
28.66
28.80

Definitions of Key Indicators

  • Stochastics Oscillator: A momentum indicator that compares a closing price to its price range over a certain period. It signals overbought conditions above 80 and oversold conditions below 20.
  • Relative Strength Index (RSI): This momentum oscillator measures price changes to evaluate overbought or oversold conditions, with readings above 70 indicating overbought conditions and below 30 suggesting oversold conditions.
Key US Economic Reports & Events
When
Actual
Expected
Previous
Bank Holiday (Labor Day)

Strategic Insights

In the complex and ever-evolving world of bullion trading, staying informed through a balanced approach that includes both technical and fundamental analysis is essential. Our report is designed to equip you with the knowledge needed to navigate the intricacies of the gold and silver markets effectively. As global economic conditions and geopolitical developments continue to unfold, remaining agile in your trading strategies will be key to capitalizing on opportunities and mitigating risks.

Disclaimer This report is provided for informational purposes only, based on data from reputable sources, but is not intended as investment advice. ISA Bullion makes no guarantees as to the report's accuracy or completeness and disclaims any liability for losses that may arise from reliance on this information. Users are advised to conduct their own research and consult with professional advisors before making investment decisions. ISA Bullion, along with any associated directors, partners, officers, employees, or agents, expressly disclaims any responsibility for any direct or indirect loss or damage arising from the use or reliance on the information provided herein.