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Issue 91 – The week of November 13th, 2023

Key Resistance and Supports: Upcoming Week

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SupportResistance
1917.001950.00
1900.001960.00
1875.001975.00
Gold
SupportResistance
22.0023.00
21.6523.25
21.1024.00
Silver

Reports of Note due out this week:

This week we’ll get the latest updates on consumer inflation and the housing market, with the October Consumer Price Index followed by last months housing starts and the NAHB’s Housing Market Index for November.

  • Monday will be a quiet day with just the monthly U.S. Federal budget at 2:00 PM.
  • Tuesday at 8:30 AM we get the Consumer Price Index (CPI) which will provide us with the latest updates on inflation for October. Consumer prices likely rose just 0.01% last month, according to the Clevland Fed, after gaining 0.04% in September.
  • On Wednesday, the BLS will report the Producer Price Index (PPI) for October at 8:30 AM. Tracking inflation from the standpoint of firms that provide goods and services, PPI inflation is often considered a leading indicator of consumer prices. We also see U.S. Census Bureau data on national Retail Sales for October which likely were flat in October after rising 0.7% in September. Also at 8:30 is the New York Empire State Manufacturing Index for November and finally at 10:00 AM will be business inventories for September.
  • Thursday morning sees the weekly Initial Jobless claims at 8:30 AM. along with the Import Price Index. 9:15 AM brings Industrial Production and Capacity Utilization and then the National Association of Home Builders confidence index at 10:00 AM for November.
  • Friday marks the deadline to avert a federal government shutdown, 45 days after Congress passed a temporary resolution to keep the government funded through November 17th.Housing Starts and Building Permits will be released at 8:30 AM.

Geopolitics

President Joe Biden will meet Chinese President Xi Jinping next week at a Pacific Rim summit in San Francisco. The meeting aims to discuss bilateral relations, open communication lines, and global issues. It follows their last meeting in 2022 and comes amid restored diplomatic interactions. While focused on managing competition and preventing conflicts, tensions have risen over incidents like a downed Chinese spy balloon and the Ukraine-Russia war. Republicans urge Biden to challenge China to improve relations. The exact location of the meeting remains undisclosed for security reasons.

The U.S. financial services division of the Industrial and Commercial Bank of China (ICBC) faced a ransomware cyberattack, disrupting Treasury trading. ICBC promptly isolated affected systems and is investigating with cybersecurity experts and law enforcement. While they successfully cleared some trades, reports suggest disruptions in U.S. Treasury trading. The U.S. Treasury Department is monitoring the situation and remains in contact with financial sector participants. ICBC clarified that its U.S. systems operate independently from its China operations and other branches were unaffected. China’s Ministry of Foreign Affairs stated ICBC’s efforts to minimize impact and losses. The perpetrator remains unidentified, typical in cyberattacks where tracing is challenging due to masking techniques. However, investigators may discern the type of software used in the attack.

The European Commission recommended inviting Ukraine to begin membership talks, a significant step toward Western integration amid ongoing conflict with Russia. President Zelenskyy hailed it as historic, despite Ukraine’s fight against Russian invasion. The talks hinge on Kyiv meeting remaining conditions, including combating corruption and protecting minority rights. EU leaders will decide in December, needing unanimity, with Hungary possibly dissenting over minority laws. Moldova and Georgia also received positive signals for future membership, contingent on meeting criteria. The move underscores the EU’s geopolitical strategy amid Russia’s aggression and the broader context of European integration.

The Call

Fed Chair Jerome Powell’s comments continue to support U.S. Dollar strength and elevated bond yields, two significant headwinds for Gold. With the Fed’s tightening bias, there is no big reason to buy gold right now. The Israeli – Hamas war continues with no significant changes developing yet. The geopolitical uncertainty that produced the frenzied buying has slowed for now with investors sidelined in the Gold and Silver market at this time. As a result of this we would expect Gold to test 1900.00 and Silver 21.00 to 21.50 this week. We remain bullish Gold and Silver into year end and next year and would view this as a time to add some precious metals to your savings.

Last Week in Review

Gold opened Sunday evening at 1994.80 spot within a dollar of the high for the week and then traded lower all week making the weekly low on Friday at 1932.80 and finally closing at 1938.20. Federal Reserve Chair Jerome Powell indicated on Thursday that the Feds job may not be finished as the bank is not confident that inflation is under control and that they would not hesitate to increase interest rates at any time.

Silver opened at 23.28 on Sunday evening and like Gold drifted lower for the rest of the week hitting its low on Friday of 22.17. A small bounce finished off the week with silver closing at 22.25.

  • The U.S. Dollar Index finished up roughly ¾ of a point on the week  at 105.86.
  • The Gold/Silver Ratio closed a little weaker for the week at 87.1 ounces of silver for 1 ounce of gold.
GoldSilver
Open1994.8023.28
High1995.6023.30
Low1932.3022.17
Close1938.2022.25
Last Week’s Gold and Silver Ranges

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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