Issue 20 – The week of June 27th, 2022

Key Resistance and Supports: Upcoming Week

Reports of Note due out this week:

Monday

• USA Durable Goods Orders. A measure the cost of orders received by manufacturers for durable goods, which means goods planned to last for three years or more, such as motor vehicles and appliances. As those durable products often involve large investments, they are sensitive to the US economic situation. A high reading is bearish for precious metals.
• USA Pending Home Sales. As the housing market is considered a sensitive factor to the US economy, it generates some volatility for the USD. A high reading is bearish for precious metals.

Tuesday

• USA Housing Price Index. It is an important indicator as the housing market is considered a sensitive factor to the US economy. A high reading is bearish for precious metals.
• USA Consumer Confidence. This captures the level of confidence that individuals have in economic activity. A high level of consumer confidence stimulates economic expansion while a low level drives an economic downturn. Generally, a high reading is also positive for the USD, while a low reading is negative.
• USA API Weekly Oil Stocks. Measures changes and is a proxy measurement of inflationary pressures and supply chain disruptions. Low stocks are bullish for precious metals.

Wednesday

• USA Gross Domestic Product. This gauges the change in the prices of goods and services. Changes in the GDP price index are followed as an indicator of inflationary pressure that may anticipate interest rates to rise. A low reading is bullish for precious metals.

Thursday

• CAD Gross Domestic Product. Is a measure of the total value of all goods and services produced by Canada. The GDP is considered a broad measure of Canadian economic activity and health. Generally speaking, a rising trend has a positive effect on the $, while a falling trend is seen as negative (or bearish) for the C$.
• USA Grain Stock Report. The Grain Stock Report is a full-text document, released by the United States Department of Agriculture, and issued four times a year. The report contains stocks of all wheat, durum wheat, corn, sorghum, oats, barley, soybeans, flaxseed, canola, rapeseed, rye, sunflower, safflower, and mustard seed. It includes the number and capacity of off-farm storage facilities and the capacity of on-farm storage facilities. This report is important for the agriculture commodity markets. Low stocks are bullish for precious metals.

Friday

• USA CFTC Net Gold Positions. The weekly Commitments of Traders (COT) report provides information on the size and the direction of the positions taken, across all maturities, with participants primarily based in Chicago and New York futures markets.

Geopolitics

At the G7 meeting in Germany, participants announced there would be a ban on Russian gold imports in their latest round of sanctions directed at Moscow.

Russia has defaulted on loan interest payments of $100 million. They have the money and are willing to pay it but are unable to pay because they are prevented from doing so because sanctions prevent them from accessing the payment mechanism.

Oil prices have started to retreat but only modestly and remain well above $100 per barrel. Supply chain disruptions will most likely keep the price high throughout the summer. Germany facing natural gas shortages is preparing for a large-scale increase in the use of coal.

The Call

With July around the corner, relaxed travel restrictions for the first time since the Covid pandemic people are eager to travel. Slow summer markets will probably be in effect from now until school starts again in September. Trading ranges will probably be subdued and quiet this week with the weekend book ended by Canada Day and US Independence Day.   

Last Week in Review

• A relatively quiet week for precious metals last week with only a slight sell-off
• Russia started to threaten Lithuania for refusing to allow transportation of goods through their territory to the Russian enclave of Kaliningrad
• Evidence emerged of the Russian removal of Ukrainian grain stores to Russia

	Gold	Silver
Open	1837	21.36
High	1847	21.92
Low	1816	20.59
Close	1825	21.10