CelticGold Market Report 19th July 2015

2015-07-19  |  Gold & Financial News

Gold 1 Year Technical Chart

Gold hit a five year low of $1129.60 on Friday morning before closing out the day at $1,134.47. The sentiment levels for Gold and Silver are very pessimistic over the short term which is largely due to continued downward pressure in commodity prices.

Market participants also are expecting that the Federal Reserve may raise interest rates before the end of the year, which is also weighing on the Gold market. Going into Thursday’s and Friday’s session Gold bulls were hoping that the strong support zone between $1130 and $1140 would hold.

Since Gold was able to post a weekly close above $1130 there is still a chance that Gold can stabilize above the $1130 support level, but most traders are bearish going into next week. One of the issues that technicians are pointing to is that now that Gold has fallen below support at $1130, even though it was intra-day, there is not much technical chart support until around $1,000.

Sentiment is so bearish that is possible that Gold could start to rally, especially since August typically starts a period of strength for Gold. Also, Carley Garner, technician and co-founder of DeCarley Trading, was a guest with Jim Cramer on CNBC’s Mad Money and she thinks that Gold could start to move higher.

Her comments on Gold are as follows. “A lot of the weakness in gold has been 100% due to the dollar,” she said. “I really think we could see minimum $1,300 [gold], maybe even $1,400, if the dollar does something to downside,” she added. (Source: Kitco 2015 July 17th) 

Gold as a Long Term Investment

For those of you who have bought at higher prices, below is a link to a chart by Visual Capitalist that shows the best performing asset classes over the last 10 years. Gold is still number 1.

Link to Visualcapitalist Returns by asset class article

Remember that the Yen, Pound, US Dollar and Euro will all likely loose purchasing power in the coming years. This is mostly to do with too much debt. Gold and Silver will over the longer term protect against currency devaluation, more than almost any other asset. 

Stocks and bonds in many parts of the world are trading at or near record highs. As a result most traditional financial assets carry risk right now. In this era of money printing and zero interest rates which have inflated most asset class, Gold and Silver are among the few that are undervalued. 

Texas Launches Gold Backed Bank

Below is a link to an article about the new Texas Gold bank. It appears from the story that the new facility will not only be a Gold depository, but also a Gold bank allowing depositors to write checks against their Gold deposits.

The overwhelming support from law makers in Texas is testament to the fact that many people know that the financial system needs to be overhauled. This could be a game changer for Gold. Other states and countries will likely follow Texas’s lead and set up similar banks.

Despite falling Gold price’s over the last few years, many people all around the world see the value in having much of their savings held in Gold that they know they can access at any time.

Link to The New American article about Texas Gold Bank launch 

Market Update for Silver

Silver 1 Year Technical Chart

Silver lost over 4% for the week to close on Friday at about $14.84. As we mentioned in the last update, Silver has been caught in the deflationary wave that has hit the commodity sector. 

Platinum, which as you know is a precious metal, also has a strong industrial component. On Friday Platinum dropped below $1,000 an ounce for the first time in 6 years. So all of the precious metals are being impacted by the overall commodity downtrend. 

So we’ll see if both Silver and Gold can stabilize next week and begin to move higher or whether lower prices are still to come.