News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • CTV projects Trudeau wins his third term as Canada's Prime Minister - BBG
  • Do you know how to properly Identify a double top formation? Double tops can enhance technical analysis when trading both forex or stocks, making the pattern highly versatile in nature. Learn more about the double top formation here: https://t.co/t9FlspUVZz https://t.co/KY6MiOC9Y6
  • US House Speaker Pelosi says top-line spending number may change but hopes for $3.5 trillion in spending bill - BBG
  • RBA Minutes: - Board committed to providing high level of monetary support - Q3 GDP expected to decline materially - Central scenario is rates on hold until 2024 - BBG $AUDUSD
  • Heads Up:🇦🇺 RBA Meeting Minutes due at 01:30 GMT (15min) https://www.dailyfx.com/economic-calendar#2021-09-21
  • New Zealand reports 14 new local Covid cases - BBG
  • I had a chance to talk with @tastytradeRyan and @victorJ0NES about Evergrande and its impact on US markets — always great talking with these two guys on Mondays. https://t.co/vddTknnPWC
  • RT @cheddar: Stocks dropped the most since May on Monday, sending shockwaves through Wall Street. @CVecchioFX explains the global impact of…
  • The Spinning Top candlestick pattern forms part of the vast Japanese candlestick repertoire with its own distinct features. Gain a better understanding of the spinning top candlestick here: https://t.co/DWm7cBMUg9 https://t.co/EegiwWMe9V
  • There are three major forex trading sessions which comprise the 24-hour market: the London session, the US session and the Asian session. Learn about the characteristics of each session here: https://t.co/reRmDdK93P https://t.co/ZE0Hgn9PCM
Gold and Silver Hold Breath for Jackson Hole, ETF Outflows Accelerate

Gold and Silver Hold Breath for Jackson Hole, ETF Outflows Accelerate

Margaret Yang, CFA, Strategist

GOLD PRICE OUTLOOK:

  • Gold and silver prices held steadily ahead of the Jackson Hole symposium
  • Investors are eyeing Jerome Powell’s speech on Friday for clues about the Fed’s tapering timeline
  • The world’s largest gold ETF saw accelerated outflows in recent weeks, underscoring downward momentum
{{GUIDE|HOW TO TRADE GOLD}}

Gold prices extended lower during Wednesday’s APAC session, testing an immediate support level at $1,785. Bullion traders are eyeing the Jackson Hole symposiumfor clues about the Fed’s tapering timeline. Fed Chair Jerome Powell will give a speech at the Fed’s annual economic symposium on Friday. Global investors will watch closely whether or not the central bank is planning to scale back the $120 billion per month asset purchase program by the end of this year. The market doesn’t seem to be too concerned about that however, as the DXY US Dollar index has fallen for the past 4 days straight.

The world’s largest gold ETF - SPDR Gold Trust (GLD) – saw three consecutive weeks of net outflow in August. This suggests that more sellers are returning to the bullion market as the Fed is drawing closer to scale back asset purchases. The number of GLD shares outstanding decreased 4.6 million last week, after dropping 2.9 and 1.4 million in the prior two weeks respectively. Gold prices and the number of outstanding GLD shares have exhibited a strong positive correlation in the past (chart below). Therefore, an accelerated pace of redemption in the ETF may be viewed as a bearish signal for prices.

Gold Prices vs. GLD ETF Shares OutstandingPast 12 Months

Gold and Silver Hold Breath for Jackson Hole, ETF Outflows Accelerate

Source: Bloomberg, DailyFX

Looking ahead, the GfK consumer confidence data dominates the economic docket alongside US GDP and initial weekly jobless claims. Find out more from theDailyFX economic calendar.

Technically, gold prices pulled back to a key support level at $1,785 – the 61.8% Fibonacci retracement. Holding above this level may open the door for further upside potential with an eye on $1,810. A breakdown however, may intensify near-term selling pressure and expose the $1,750 support. The MACD indicator formed a bullish crossover and trended higher, suggesting that upward momentum isbuilding.

Gold - Daily Chart

Gold and Silver Hold Breath for Jackson Hole, ETF Outflows Accelerate

As for silver,prices breached below a trendline support and plunged to a key support level at $22.90 – the 38.2% Fibonacci retracement. Prices have likely formed a bullish “Double Bottom” chart pattern after rebounding twice from the key support. The overall trend remains bearish-biased, as suggested by the consecutive lower highs and lower lows. The MACD indicator formed a bullish crossover beneath the neutral midpoint, suggesting that buying power may be building.

Silver – Daily Chart

Gold and Silver Hold Breath for Jackson Hole, ETF Outflows Accelerate

--- Written by Margaret Yang, Strategist for DailyFX.com

To contact Margaret, use the Comments section below or @margaretyjy on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES