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Issue 96 – The week of December 18th, 2023

Key Resistance and Supports: Upcoming Week

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SupportResistance
1991.602062.90
1973.502072.90
1940.902100.00
Gold
SupportResistance
23.3824.33
22.6624.82
21.9825.20
Silver

Reports of Note due out this week:

Key takeaways this week will be Fridays release of the Personal Consumption Expenditures (PCI) for November. This will indicate whether inflation is continuing to trend lower. Data on homebuilder confidence, housing starts, building permits, existing home sales, and new home sales will provide insight into the housing market. The final 2023 Michigan Consumer Sentiment Index will be released as well.

  • Monday has home builder confidence index at 10:00 AM.
  • Tuesday at 8:30 AM we see the release of the of Housing Starts and Building Permits.
  • On Wednesday, we start off with the U.S. current account for the 3rd quarter. At 10:00 AM we see the release of Existing Home Sales.
  • Thursday sees the weekly release of the Initial Jobless Claims for the week ending December 16th. Forecast is for an increase to 213,000 from 202,000 last week. Also, at 8:30 we see GDP (revision) and the Philadelphia Fed manufacturing survey. At 10:00 AM we see the release of the U.S. leading economic indicators for November.
  • Friday sees numerous indicators being released at 8:30 AM.  Durable -goods orders (November), Personal Income (Nov) and the Personal Expenditure Index (PCE Index Nov) and then at 10:00 AM sees New Home Sales and Consumer sentiment (final).

Geopolitics

Taiwan is preparing for its presidential election amid warnings of potential Chinese influence. President Tsai Ing-wen cautions against Chinese disinformation campaigns, as the front-runner, Lai Ching-te, faces challenges from candidates favoring closer ties with China. China frames the election as a choice between war and peace, reflecting its stance on Taiwan’s sovereignty. Disinformation efforts aim to undermine trust in the U.S. and Taiwan’s democratic processes, intensifying political polarization. Despite this, it’s unlikely to significantly sway election results. The U.S., while not endorsing any candidate, reaffirms its support for Taiwan’s democracy and pledges assistance in combating disinformation. China maintains military pressure on Taiwan, complicating the election landscape further.

In the past day, both Russia and Ukraine reported numerous attempted drone attacks. Ukraine’s air defense claimed to have shot down 30 out of 31 drones launched against 11 regions, while Russia said it thwarted Ukrainian drone attacks in Crimea and the Kursk region. The increased drone activity coincides with a prolonged war, with neither side gaining significant ground despite Ukrainian counteroffensives. The EU’s promise of 50 billion euros in funding to Ukraine was delayed due to Hungary’s veto, but leaders hope talks of EU membership will boost Ukraine’s morale despite the lengthy process ahead.

The leaders of Guyana and Venezuela met to address a longstanding border dispute over the Essequibo region. They agreed not to use threats or force and established a joint commission to tackle the issue. Despite tension over the discovery of oil in Guyana and Venezuela’s claims to Essequibo, both sides committed to peaceful resolution. Guyana asserts the dispute should be settled by the International Court of Justice, while Venezuela disagrees. The meeting took place in St. Vincent, with Caribbean prime ministers present. Guyana emphasized Essequibo’s non-negotiable status, while Venezuela has ordered exploration of its resources. Both countries have put their militaries on alert, amid allegations of U.S. involvement. The meeting aims to prevent conflict and maintain peace in the region.

China has successfully launched a reusable robotic spacecraft for the third time since 2020, aiming to develop cost-effective space mission technologies. The uncrewed spacecraft, launched atop a Long March 2F rocket, will operate in orbit before returning to a designated landing site in China. Its mission includes verifying reusable technologies and conducting space experiments. Details on the spacecraft’s activities remain undisclosed, and images have not been made public. The program, dubbed “Shenlong” or “Divine Dragon,” parallels the U.S. X-37B autonomous spaceplane initiative. Both countries exhibit keen interest in each other’s projects, reflecting the growing space rivalry. Reusable spacecraft development is seen as crucial for increasing spaceflight frequency and reducing costs.

The Call

Last weeks gold movement was close to what we expected. The last 2 weeks of the year should have lower trading volumes and therefore a strong possibility of heightened volatility. We expect gold to range trade between 1925.00 and 2075.00 for the rest of 2023. The Federal Reserve indicated interest rate increases have peaked and we are now able to see several rate cuts next year. These rate cuts should provide gold with upward momentum to make a new all time high during 2024. We remain bullish long term on gold and silver. Happy Holidays from all of us at Guardian International Gold Corp. and may you have a prosperous New Year.

Last Week in Review

Gold opened Sunday evening at 2005.60 spot and then traded lower hitting 1973.10 Wednesday morning. Wednesday afternoon, after the FOMC decision on interest rates, Gold started rallying and the weekly high was achieved on Thursday afternoon at 2048.50 per ounce. However, the rally proved to be unsustainable and by the end of the day on Friday gold had pulled back to close the week out at 2019.30 per ounce. 

Silver opened Sunday evening at 23.03 and drifted lower into Wednesday morning making the weekly low of 22.51 before the FOMC interest rate decision at 2:00 PM took the metals higher. Following Gold lead, Silver rallied to 24.32 before following gold down a little to settle the week at 23.90.

  • The U.S. Dollar Index finished the week lower after the FED’s decision on interest rates on Wednesday at 102.18.
  • The Gold/Silver Ratio got recovered some of last weeks move to finish at 84.6 ounces of silver for 1 ounce of gold.
GoldSilver
Open2005.9023.03
High2048.5024.32
Low1973.1022.51
Close2019.3023.90
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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