Stylized representation of the movement of the price of gold.

Guardian Weekly Market Report – Issue 114

Site icon for Guardian Gold     Issue 114 – The Week of April 22nd, 2024

Key Resistance and Supports this Week

SupportResistance
2355.002433.40
2321.802484.60
2270.002547.00
2231.502609.00
SupportResistance
27.6129.10
26.5529.90
26.0031.00
25.1032.50

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Reports of Note Due This Week

Market watchers will be closely focused on the Personal Consumption Expenditures Index (PCE) which will be the last measure of inflation before the next meeting of the Federal Reserve.

  • Monday, April 22 – None scheduled.
  • Tuesday April 23 – At 9:45 AM we see the S&P flash U.S. services PMI(April) and S&P flash U.S. manufacturing PMI(April). Then at 10:00 AM comes the new home sales expected at 670,000 from last months 662,000.
  • Wednesday April 24 – at 8:30 AM we see the release of Durable-goods orders for March which are predicted to rise to 2.8% from 1.3%.
  • Thursday April 25 – sees the Weekly Initial Jobless Claims at 8:30 AM. They are expected to come in at 215,000 up from last weeks 212,000. Also, at 8:30 the advanced U.S. trade balance in goods and advanced Retail and Wholesale inventories. Then at 10:00 AM, pending home sales for March will be released and are expected to be flat, down from 1.6%.
  • Friday April 26 – The big one for the week, the PCE Index will be released at 8:30. Also at 10:00 AM sees the consumer sentiment (final) for April.

Geopolitics

India began its 2024 general elections on April 19, with nearly one billion voters expected to participate over six weeks in seven phases. This election will determine if Prime Minister Narendra Modi will be granted a third term. The election will decide the makeup of the Lok Sabha, India’s powerful lower house of Parliament. Modi’s party, the Bharatiya Janata Party (BJP), is anticipated to win against the opposition coalition led by the Indian National Congress. Modi’s leadership has seen India become the world’s fifth-largest economy. Key voter concerns include unemployment and rising costs, with the election’s outcome pivotal for both domestic policies and international relations. Results are expected on June 4.

Israeli forces launched a counterstrike on Iran in response to Iran’s drone and missile attack, marking a significant escalation between the two nations. The strike targeted areas around Isfahan, a city with key military installations, but initial reports suggest minimal damage and no casualties. This attack comes amid ongoing tensions and follows Iran’s direct assault on Israel, the first of its kind, which was itself a retaliation for an Israeli bombing in Syria. The situation remains tense, with global leaders urging restraint to prevent further escalation into an all-out regional conflict. Secretary of State Antony Blinken confirmed that the U.S. was not involved in the offensive operations but is focused on de-escalating the situation.

The U.S. House of Representatives has moved forward a substantial $95 billion aid package aimed at supporting Ukraine, Israel, and the Indo-Pacific region. This decision comes after overcoming resistance from some hardline Republicans. The package, which mirrors a version passed by the Senate in February, also includes transferring frozen Russian assets to Ukraine, imposing sanctions on Hamas and Iran, and measures that could force the sale of TikTok by its Chinese owner ByteDance. The bill, which received more support from Democrats despite a Republican majority, also addresses humanitarian needs with $9.1 billion allocated for such aid. The next steps involve a final House vote and subsequent Senate approval to enact the legislation.

The Arabian Peninsula experienced unprecedented rainfall and flooding, severely impacting the United Arab Emirates and Oman. In the UAE, some areas received 10 inches of rain in just 24 hours, surpassing records dating back to 1949. This event led to the suspension of flights and school closures, and authorities urged residents to stay home. In Oman, the severe weather resulted in the deaths of at least 18 people. The region, typically dry and arid, faced substantial disruptions from the floods, highlighting potential climate change implications, as warmer atmospheres can intensify storm activity.

The Call

Last week gold tested the 2450.00 area and closed a little lower by Friday. Gold needs to retest that 2450.00 area and if it cannot make new highs again, we would expect a pull back in the price of gold to the 2250.00 support zone over the next few weeks if the Israel Iran conflict remains muted. We are still bullish on gold but feel a short-term dip would be very healthy and would then hope for a strong rally towards 2500.00 to 2600.00 by year end.


Last Week in Review

Gold opened at 2354.00 Sunday evening and dipped to make the weekly low at 2324.90 on Monday morning near midday. We then traded in a range between 2330.00 – 2400.00 until gold broke upwards again on Friday making another new all time high at 2417.90. Gold then pulled back a little on profit taking and finished the week at 2391.40.

Silver opened at 28.17 on Sunday evening and spiked down quickly to make the weekly low of 27.64  before range trading from 28.00 and 28.75 for most of the week. Silver had a little rally to just under 29.00 and closed out the week at 28.72.

  • The U.S. Dollar Index finished a little higher on the week at 106.15.
  • The Gold/Silver Ratio narrowed again this week at 83.5 ounces of silver for 1 ounce of gold.

Last Week’s Price Ranges

MarketGoldSilver
Open2354.0028.17
High2417.9029.07
Low2324.9027.64
Close2391.4028.72

The information contained in this report is intended to provide market commentary and not as a recommendation or as a basis for investment decisions. The views expressed herein are the author’s and may differ from the views of others at Guardian International Gold. Guardian International Gold is a trader of Precious metals and this communication is to be considered an invitation to trade. Guardian International Gold makes our best effort to communicate reliable information but no express or implied warranty or representation as to its accuracy, completeness, or correctness may be taken.

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