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Japans unemployment rate was 2.7% in January, below the expected 2.60% and the previous reading of 2.60%.Kuwaiti Ministry of Defense: Since the start of the Iranian attacks, we have detected 178 ballistic missiles and 384 drones.1. International oil prices rose across the board, with the WTI crude oil futures contract rising 5.98% to $71.03 per barrel and the Brent crude oil futures contract rising 6.82% to $77.85 per barrel. The joint US-Israeli airstrikes on Iran triggered a sharp escalation of tensions in the Middle East, raising market concerns about shipping safety in the Strait of Hormuz and potential retaliatory production cuts by Iran. 2. International precious metals futures closed mixed. COMEX gold futures rose 1.68% to $5335.90 per ounce, while COMEX silver futures fell 3.95% to $89.61 per ounce. Escalating tensions in the Middle East disrupted shipping in the Strait of Hormuz, increasing geopolitical risks and boosting safe-haven demand. This heightened the importance of gold as a strategic neutral reserve asset, coupled with increased expectations that the Federal Reserve would maintain interest rates, all contributing to the rise in gold prices. 3. Most London base metals fell. LME aluminum rose 1.43% to $3185/ton, LME lead fell 0.05% to $1961/ton, LME zinc fell 0.29% to $3307.5/ton, LME copper fell 1.94% to $13084.5/ton, LME nickel fell 3.58% to $17205/ton, and LME tin fell 8.38% to $52890/ton. 4. The three major U.S. stock indexes closed mixed. The Dow Jones Industrial Average fell 0.15% to 48904.78 points, the S&P 500 rose 0.04% to 6881.62 points, and the Nasdaq Composite rose 0.36% to 22748.86 points. Home Depot and 3M fell more than 2%, leading the Dow Jones decline. The Wind U.S. Tech Big Seven Index rose 0.56%, with Nvidia rising nearly 3%. The Nasdaq China Golden Dragon Index fell 1.08%, Kingsoft Cloud fell nearly 5%, and Zai Lab fell over 4%. 5. European stock indices all closed lower: the German DAX fell 2.42% to 24,672.4 points, the French CAC40 fell 2.17% to 8,394.32 points, and the UK FTSE 100 fell 1.2% to 10,780.11 points. Escalating military conflict in the Middle East led to a surge in oil prices, reigniting inflation concerns and prompting investors to sell risky assets for safety. 6. Most major Asia-Pacific stock indices closed lower: the Nikkei 225 fell 1.35% to 58,057.24 points, and the Indian SENSEX 30 fell 1.29% to 80,238.85 points. The South Korean KOSPI was closed for a holiday.The Israel Defense Forces stated that they are currently conducting strikes against Hezbollah command centers and weapons storage facilities in Beirut.Japans January unemployment rate will be released in ten minutes.

June Gold Buyers May Face Difficulties at $1987.60

Larissa Barlow

Apr 14, 2022 10:14

The market's strength is being fueled by demand for a hedge against rising inflation during the Russia-Ukraine conflict, lessening pressure from expectations of an aggressive US interest rate hike, and the US Dollar's intraday reversal top.

 

June Comex gold futures are currently trading at $1982.70, up $6.60 or 0.33 percent from their previous close. The SPDR Gold Shares ETF (GLD) is currently trading at $184.66, up $0.89 or 0.48 percent from its previous close.

 

Gold is regarded as an inflation hedge and a hedge against geopolitical concerns. However, higher interest rates in the United States would increase the opportunity cost of storing non-yielding bullion and strengthen the dollar against which it is valued.

 

However, the price action shows that gold buyers are seeking insurance against inflation and are not very concerned about opportunity costs at the moment. Despite all of the Fed's hawkish rhetoric and anticipation for aggressive rate hikes, we have yet to witness a shift in the direction of inflation.

 

Gold is likely to remain underpinned for the foreseeable future as long as the inflation arrow continues to point upward and the Ukraine war continues.

 

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Technical Analysis of the Daily Swing Chart

According to the daily swing chart, the primary trend is upward. A move over the intraday high of $1985.50 reaffirms the uptrend. A break of $1916.20 will revert the major trend to the downside.

 

On the upside, the retracement zone between $1987.60 and $2009.90 is the nearest objective.

 

On the downside, the long-term Fibonacci level at $1958.70 serves as the initial support, followed by the short-term 50% level at $1932.90.

Technical Forecast for the Daily Swing Chart

The June Comex gold futures market's path through Wednesday's close is likely to be dictated by trader reaction to the 50% level at $1987.60.

Scenario of Bullishness

A sustained move above $1987.60 will signal that buyers are present. This could provide the necessary momentum for a test of the Fibonacci level at $2009.90. This is a trigger point for an upside acceleration.

Scenario of the Bear

A persistent decline below $1987.60 indicates the existence of sellers. They intend to attempt the formation of a secondary lower top. This, if successful, might result in a break into $1958.70.

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