Stylized representation of the movement of the price of gold.

Guardian Weekly Market Report – Issue 121

Site icon for Guardian Gold     Issue 121 – The Week of June 10, 2024

Key Resistance and Supports this Week

SupportResistance
2250.002368.00
2222.302400.00
2184.002455.00
2125.002500.00
SupportResistance
28.6530.10
28.1031.00
27.5031.75
26.7532.50

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Reports of Note Due This Week

The Federal Reserve is expected to keep interest rates unchanged this week even though Europe and Canada lowered their rates last week. U.S. jobs report on Friday was stronger than expected and sent the markets lower with traders realizing the likelihood of rates staying the same this week. We will also get an update on inflation with the CPI and PPI coming out on Wednesday and Thursday mornings.

  • Monday, June 10 – None scheduled.
  • Tuesday June 11 – Federal Open Market Committee (FOMC) meeting begins. .
  • Wednesday June12 – at 8:30 AM we see the release of the CPI which is expected to show a softening in inflation for the month. Then at 2:00 PM we get the Federal Reserve interest rate decision and Federal Resedrve Chair Jerome Powell’s press conference at 2:30 PM.
  • Thursday June 13 – sees the Weekly Initial Jobless Claims at 8:30 AM. They are expected to come in at 225,000, down from last weeks 229,000. Also at 8:30 AM we have The Producer Price Index out for May and is called to be up only 0.1% versus up 0.3% the month before.
  • Friday June14 – At 8:30 A.M., we see the release of the import/export numbers. At 10:00 AM, the consumer sentiment(prelim) will be released. 

Geopolitics

South Korean President Yoon Suk Yeol is visiting Central Asia, including Turkmenistan, Kazakhstan, and Uzbekistan, to discuss strengthening diplomatic ties and cooperation in energy and minerals. During his trip, he will sign agreements and attend business forums focused on expanding supply chain cooperation for critical minerals like lithium and uranium. Yoon’s visits are part of a broader initiative to ensure access to essential resources and markets, following recent summits with African nations and a trade agreement with the United Arab Emirates.

Nigel Farage announced he will lead the Reform U.K. party and run for a Parliamentary seat in Clacton-on-Sea in the upcoming general election. Despite previous losses and statements about focusing on supporting Donald Trump in the U.S. election, Farage decided to run due to a perceived obligation to his supporters. His participation could complicate matters for Prime Minister Rishi Sunak’s Conservative Party, which is already facing challenges in the polls. Farage aims to form the “real” opposition should the Conservatives lose to Labour, leveraging his experience and populist influence to impact U.K. politics.

On Thursday President Vladimir Putin threatened to supply arms to other regions to target Western countries in retaliation for their support of Ukraine. He stated this could be a response if the West continued allowing Ukraine to attack Russian territory. President Joe Biden responded, emphasizing the U.S. is not permitting Ukraine to use American weapons to attack deep inside Russia. Putin also warned that he might use nuclear weapons if he perceives a direct threat to Russia’s sovereignty, contradicting Western beliefs that Russia would refrain from using such weapons.

The Call

Gold and silver finished the week with an aggressive selloff that took them down to the 2300.00 level on gold and close to the 29.00 on silver we were looking for. Now what will the path of the metals look like. We had Europe and Canada lower their interest rates last week but after the U.S. nonfarm jobs report of 272,000 jobs created versus an expected 190,000 consensus many feel the U.S. rates will be on hold. We also had an indication that one refiner was limiting silver deliveries which is reminiscent of what occurred in the early 1980’s when scrap silver flowed into the refineries at a rate they could not keep up with. This changes the landscape a little. The summer slowdown is here and the metals will have to consolidate down here and form a bottom. The question will be how much lower they will go. We feel that the 2200.00 level on gold and 27.50 on silver are reasonable targets for now.  


Last Week in Review

Gold opened at 2328.60 Sunday evening and spent Monday through Thursday trading in a narrow 40.00 range waiting for the nonfarm payroll number Friday morning. The weekly high was reached around midnight on Thursday at 2386.90. From here, gold collapsed on the news that China had broken there 18-month streak of sovereign gold purchases and the selling began. Gold dropped to the 2335.00 level moments before the payroll number and with a stronger number than expected took gold down the rest of the day on Friday with the low of 2284.70 coming near the close in the afternoon. Gold settled at 2291.50 which was below the 2300.00 support level.

Silver opened Sunday evening at 30.53 and like gold, range traded during the week waiting for the numbers on Friday. With gold selling off aggressively, silver followed with a down move of over 2.00 to make its weekly low of 29.125 on Friday afternoon as well.

  • The U.S. Dollar Index didn’t do much for the week and finished at 104.89.
  • The Gold/Silver Ratio weakened this week to settle at 78.7 ounces of silver for 1 ounce of gold.

Last Week’s Price Ranges

MarketGoldSilver
Open2328.6030.53
High2386.9031.57
Low2284.7029.12
Close2291.5029.18

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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