Issue 45 – The week of December 19th, 2022

Key Resistance and Supports: Upcoming Week

Reports of Note due out this week:

Monday

• There are a number of interesting reports this week that are not on the radar. They likely won’t directly affect precious metals pricing, but they are a good indicator of global inflation pressures. Interest rate decisions from China and Japan will be released Monday night, in that order. Continued hawkish action from central banks could keep pressure on precious metal prices.

Thursday

• On Thursday both the US and Canada release Gross Domestic Product (GDP) figures. Look for positive reports from both economies which create a bearish sentiment for precious metals and a buying opportunity as markets head towards year-end.

Friday

• Friday sees the release of Canadian Retail Sales. Falling energy prices should be giving some disposable income to Canadian households for holiday shoppers. Precious metals prices again may suffer from a stronger CAD dollar. Another buy-the-dip moment.

Geopolitics

As expected, China is seeing a surge in Covid cases as travel restrictions relax. Most younger people in the country have been vaccinated but most elderly people have not. The government now seems resigned to accepting they need to accept this to get their economic performance back up and running. They still face significant hurdles. They have a lot of resources and very deep pockets to recoup lost production from the past three years of lockdowns and they play the long game. They are a patient nation. Don’t count them out even though their footing seems precarious.

It’s now 299 days of Russia’s three-day war against Ukraine and it’s not looking good for the Russians. This is looking positive for global supply chains to which Ukraine is a significant contributor. They supply food and industrial metals to many countries and economic sectors. This writer, among countless others, hopes the new year will see peace return to Ukraine.

The Call

This week will be the last week of any real trading before the end-of-year holidays begin. Gold looks like it wants to get up above 1800 before the end of the year. Any price dips are buying opportunities. The 1800 handle has been a key battleground for a good chunk of this year and it looks like it wants to move higher. If not this week, soon.

Last Week in Review

• After last week’s anticipated US Fed interest rate hike gold was able to hold itself above the 1800 handle but could not sustain it at the week’s close.
• The Fed announced last week that they are not going to stop hiking interest rates going into the next year, saying further hikes will be coming. It is hard to speculate on their target especially as they walk the tightrope of keeping inflation in check and not derailing the economy.

	Gold	Silver
Open	1794	23.35
High	1824	24.12
Low	1773	22.54
Close	1790	23.13