FXTM: Gold Awaits Fresh Market-Moving Catalyst
Gold needs a fresh catalyst, says Lukman Otunuga,research analyst at FXTM. Otherwise, the yellow metal remains in a range, with $1,300 acting as a psychological pivotalpoint. “Price action continues to suggest that gold needs a fresh directionalcatalyst to make its next significant move,” Otunuga says. “A U.S.interest-rate increase in June, coupled with expectations of further rate hikesduring the second half of the year, could spell trouble for zero-yieldinggold.” Technically, market participants will continue observing how gold faresaround the $1,300 level, the analyst continues. “A breakout above $1,300 couldtrigger an incline towards $1,324,” Otunuga says. “Alternatively, a failure forbulls to conquer $1,300 is likely to result in a decline back to $1,280.”
By Allen Sykoraof Kitco News; asykora@kitco.com
MKS: Gold ETFHoldings Decline Over Last 10 Days
Wednesday June 13, 2018 08:38
Holdings ofgold by global exchange-traded funds have declined over the last 10 days,reports Alex Thorndike, senior precious-metals dealer with MKS (Switzerland)S.A. The ETFs trade like a stock but track the price of the commodity, withmetal put into storage to back the shares. Thorndike cites Bloomberg data showing that ETF gold holdings dipped“somewhere in the realm of 1 million ounces of gold over the past 10 days --from 72 million to 71 million ounces. Any significant acceleration on sales inthis space could see a sharp downside flush-out through $1,285-90 support.” Themain catalysts this week are a meeting of the Federal Open Market Committeethat ends Wednesday and a Thursday meeting of the European Central Bank. Inparticular, the gold market will be watching the impact of these meetings onthe U.S. dollar and euro, Thorndike adds.
By Allen Sykoraof Kitco News; asykora@kitco.com
Commerzbank:Gold, Palladium Premiums Over Platinum Widen
Wednesday June 13, 2018 08:38
Platinumprices have fallen back below $900 an ounce and its discount to palladium andgold have widened, points out Commerzbank. Gold’s premium over platinum haswidened to around $400 an ounce, analysts note. “The pricediscount of platinum as compared to palladium has likewise increased again [toaround] $125 per troy ounce,” Commerzbank says. “Besides good fundamental data- car sales in the U.S. and China were robust in May - the technical picturefor palladium has improved noticeably recently, which has clearly attractedfurther buyers and lent support to the price.”
By Allen Sykoraof Kitco News; asykora@kitco.com
BBH: FOMC OneVote From Signaling Four Hikes In 2018
Wednesday June 13, 2018 08:38
Brown BrothersHarriman points out that the voting makeup of the Federal Open Market Committeeis only one vote away from hiking interest rates four times this year ratherthan three. Policymakers wind up a two-day meeting Wednesday. They are expectedto hike interest rates another 25 basis points, but traders will be watchingfor clues of future monetary policy, including the Fed’s so-called dot-plotthat shows expectations for future monetary policy by individual policymakers. “For the median forecastto move to four hikes this year...only one member has to shift their vote,” BBHsays. “It is that close. Failing to do so would be seen by some as a dovishhike, though the Fed funds futures strip does not show the market is convincedof an accelerated pace.” Investorswill also be trying to gauge the pace of tightening in 2019. “The Fed itself seemssplit, with most of the regional presidents appearing more concerned about therisks of an inversion of the yield curve than the board of governors,” BBH says.
By Allen SykoraFor Kitco News
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