Guardian Weekly Market Report 95

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Issue 95 – The week of December 11th, 2023

Key Resistance and Supports: Upcoming Week

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SupportResistance
1984.202056.50
1944.002085.00
1907.502118.80
1860.002142.00
Gold
SupportResistance
22.6223.30
21.9524.12
20.8725.16
20.5425.87
Silver

Reports of Note due out this week:

Markets watchers this week will focus on the Consumer Price Index on Tuesday, the Producer Price Index, and the Federal Reserve interest rate decision on Wednesday afternoon. It is believed that the central bank will leave interest rates unchanged.

  • Monday has nothing scheduled.
  • Tuesday at 8:30 AM we see the release of the Consumer Price Index for November. The expectation is for unchanged for the CPI and up to 0.3% from 0.2% on the Core CPI. The year over year CPI is expected to drop slightly to 3.0% from 3.2%.
  • On Wednesday, we start off with the Producer Price Index for November at 8:30 AM.  Median forecast is for a 0.1% increase from a -0.5% decline. Then at 2:00 PM, the FOMC interest rate will be announced followed by Fed Chairman Jerome Powell press conference.
  • Thursday sees the weekly release of the Initial Jobless Claims for the week ending December 9th. Forecast is for unchanged at 220,000. Also, at 8:30 we see Import Prices and U.S. Retail Sales. Retail sales are expected to come in unchanged at 0.1%. At 10:00 AM we see the release of Business inventories which are expected to be softer at unchanged from 0.4%.
  • Friday sees the release of the Empire State manufacturing survey at 8:30 AM. Industrial Production comes out for November at 9:15 AM with expectations of an increase to 0.2% from Octobers -0.6%. Also, Capacity utilization index for November is released and a small increase to 79.1% is expected from 78.9%

Geopolitics

Vladimir Putin has announced his candidacy for Russia’s presidential election in March, virtually ensuring his continued grip on power for another six years. Despite criticism for starting the costly war in Ukraine and facing internal attacks, Putin still enjoys broad support, with around 80% approval ratings. His ability to maintain control, including amending the constitution to extend his rule, suggests little genuine opposition. Some analysts suggest that Putin’s fear of losing power drove him to initiate the conflict in Ukraine, using it to solidify his authority amidst declining popularity. Putin’s decision to seek reelection reinforces his determination to remain in power, despite concerns about his autocratic rule.

Chinese naval vessels have docked at Cambodia’s Ream Naval Base, marking the first such occurrence and raising concerns about Beijing’s intentions in the region. The docking coincided with a visit by China’s top defense official, Vice Chairman He Weidong, though Cambodian Defense Minister Tea Seiha’s Facebook post did not explicitly mention China. Satellite images suggest the presence of two Chinese warships, likely Type 56 corvettes, at the base. Controversy surrounding the base emerged in 2019 amid reports of a potential 30-year agreement between Cambodia and China, though Cambodian officials denied such claims. The base’s location near the South China Sea raises concerns about regional security and Beijing’s expanding military influence. Despite concerns from the U.S. and other countries, Cambodia maintains strong political and economic ties with China. Prime Minister Hun Manet’s recent discussions with Chinese officials highlight the continued military cooperation between the two countries.

The UK government has accused Russia’s FSB intelligence agency of engaging in cyberespionage and malicious cyber activities targeting British politicians, civil servants, and journalists since at least 2015. The operations involved impersonating legitimate contacts to compromise email accounts in various sectors, including the public sector, universities, media, NGOs, and civil society. While some documents were leaked, attempts to interfere with UK politics and democracy were reportedly unsuccessful. In response, the UK imposed sanctions on an FSB officer and a member of Star Blizzard and summoned the Russian ambassador, condemning Russia’s interference in UK politics. Foreign Secretary David Cameron called the attempts “completely unacceptable.”

The Call

Gold rallied on Sunday night to make an all time high at $2,136.00 an ounce before an avalanche of selling started and the price dropped about $140.00 down to just under $2,000.00 and closed at $2,004.40. The top is in for now and support for gold is around the $1,950.00 area. After a bottom a little lower from here we should get a rally towards $2,050 – $2,075.00 before falling back and settling in the $1,950.00 – $2,000.00 range.

Last Week in Review

Gold opened Sunday evening at 2078.10 spot and then traded sharply higher on a few thousand computer driven buy orders in a thinly traded market hitting an all time high of 2136.10 per ounce. However, the rally proved to be unsustainable and by the end of the day on Monday was down to 2031.70 per ounce. The selling continued with numerous favourable job reports out resulting in gold settling the week at 2004.40, down more the 68.00 on the week.

Silver opened Sunday evening at 25.65 and pushed higher to 26.04 before following gold down for the rest of the week and settled at 23.00, down over 2.50 from the close a week ago.

  • The U.S. Dollar Index finished up marginally for the week  at 104.01.
  • The Gold/Silver Ratio got hammered this week and widened out to 87.3 ounces of silver for 1 ounce of gold.
GoldSilver
Open2078.1025.65
High2136.1026.04
Low1994.2022.94
Close2004.4023.00
Last Week’s Gold and Silver Ranges

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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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