Gold

For the better part of the last 24 hours of trading, gold pricing has managed to trade above $1800. Gold futures traded to an intraday high today of $1815.70. However, with only 45 minutes left in Globex trading (New York trading has already closed) gold futures basis, the most active February 2021 Comex contract is trading up by $0.70 (+0.04%) and fixed at $1798.90.

As they say in real estate, it’s all about location. Yesterday judging by how gold and U.S. equities moved, it was not so much about the statement and dot plot, but it was all about Powell’s press conference. Gold had been trading lower before the release of the statement and dot plot trading to a low of $1753.

The Federal Reserve concluded the last FOMC meeting of the year capped off by a statement that contained a new “dot plot” which lays out their updated monetary policy through 2024. The last dot plot anticipated that there would only be one interest rate hike in 2022. However, that changed dramatically.

With less than 24 hours before the FOMC meeting concludes market participants continue to factor in a much more aggressive and hawkish stance on the part of the Federal Reserve to combat the spiraling level of inflation.

Gold futures had modest gains in trading today as investors focus upon the recent CPI inflation index data indicating that inflation is running at a 40-year high at 6.8% year over year. With inflationary levels at their current level, market participants are waiting for the FOMC meeting to begin tomorrow and conclude on Wednesday.

EDITORS NOTE We recorded an interview live at 9 PM Eastern Standard Time, I was part of that live podcast to address the record levels of inflation as revealed today. The video is below the Weekend Review

Tomorrow the U.S. Bureau of Labor Statistics will release the inflationary numbers vis-à-vis the CPI index. This report will be a critical component that the Federal Reserve will review before releasing its adjusted monetary policy. On Wednesday of next week, the Federal Reserve will release the statement including the revised dot plot and a press conference by Chairman Jerome Powell.

On Friday, November 10 the U.S. Bureau of Labor Statistics will release its most current report on inflation for November 2021. Inflationary pressures have spiraled out of control and since June have consistently been at or above 5.3%. Currently, economists are forecasting that Friday’s report will show that inflation has increased by 0.7%.

Gold futures basis the most active February 2022 contract had modest gains today and as of 5:25 PM EST is currently fixed at $1784.90. Gold traded to a high of $1789.30, and a low of $1772.40. The current price matches precisely with a technical level we have identified using a Fibonacci retracement.