Five steps forward and three steps back. This represents how the most recent activity looks on a weekly gold chart. Beginning the week of March 13th, for five consecutive weeks, gold prices closed higher on the week. This upside action moved gold prices from below $1200 to just below $1300.
Despite attempting to find a foothold and some price stability today, gold still suffered a major price decline this week. Gold futures are currently trading at 1229.30, marking a net change of approximately $0.60. Of course, any upside move would be dwarfed in comparison to the drawdown, which resulted in a $40 loss of value this week.
The current selling pressure in gold and silver continues and accelerates, even with a dynamically weaker U.S. dollar. The U.S. dollar is once again trading under pressure, making this the fourth day in a row. As of 3:30 Eastern Standard Time, the U.S. dollar index is off almost half of a percent, currently fixed at 98.61.
The first of two key events affecting financial markets this week, this month’s Federal Open Market Committee (FOMC) meeting, has just concluded. On Friday, the Department of Labor will release its jobs report, containing data about new jobs added in April. Based on a survey by Reuters, economists expect the April count to include 175,000 added jobs.
Quiet and subdued action is the underlining characteristic of the day, as market participants await the conclusion of this month’s Federal Open Market Committee (FOMC) meeting. Most analysts believe that the result will be interest rates that remain steady and fixed at their current rate.
Under intense selling pressure, the precious metals complex traded dramatically lower on the day. As of 4 o’clock Eastern standard time, gold (spot price) is currently trading at 1257 (-.0.88%), putting it down almost $11 on the day. The most active futures contract (June 2017) is trading at 1258, down just over $10 (-0.82%) on the day.
While closing lower on the week and higher on the day, one only needs to stand back to see the respectable performance in gold prices this year. Gold closed out the month of April with a moderate gain of 1%. This came following a dismal performance in March, in which gold prices closed relatively unchanged, gaining roughly 1 dollar during the month.
Unless the House and Senate Appropriations Committee pass a short-term spending bill to keep the doors of the government open, the U.S. government will run out of money at exactly midnight on Friday April 28th.
Is President Trump living in a “Field of Dreams” or will his proposed “massive” tax cut grow the economy enough to make up for the trillions of dollars of lost revenue? That is the question on the minds of economists and individual taxpayers, as well as, and most importantly, the politicians who will vote on this proposal.
U.S. equities continue their historic climb, an event which began last year and accelerated exponentially following the presidential election in November. The Dow Jones Industrial Average gained 1.12% on the day, rising 232.23 points and closing at 20996.12. The S&P 500 rose 0.66% today, a gain of over 15 points to close at 2389.68.
