Fundamental News and Triggers
Precious metals inches closer to peak on rising geopolitical tensions
- Precious metals prices are underpinned by increased safe-haven demand amid heightened geopolitical concern following weekend events in Venezuela, as well as rising expectations on Federal Reserve rate reduction after the release of poor U.S. manufacturing PMI data.
- Manufacturing activity in the United States dropped more than predicted in December, reaching a 14-month low.
- Market players are also looking forward to Friday’s US monthly employment data, which is expected to show 60,000 jobs added in December, a modest decrease from 64,000 the previous month.
- Minneapolis Fed President Neel Kashkari warned on Monday that the unemployment rate could “pop” higher, raising the possibility of a rate cut.
- Meanwhile, Maduro pleaded not guilty in a New York court on Monday to narco-terrorism accusations as well as possession of machine weapons and destructive devices.
Technical Triggers
- Gold prices have rebounded from $4300 and cleared the resistance of $4450 (~Rs 138,000). The next resistance is $4550 (~Rs 140,000) and $4600 (~Rs 141,000)
- Silver prices have touched its previous peak of $82.6 (~Rs 260,000), creating double top formation. We could see some profit booking from here, but when it breaks previous top again, the next level to watch for is $84 (~Rs 266,000) and $88.5(~Rs 280,000)
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