The Week That Was: Gold’s Price Spike and the Fed Rate Hike Dilemma
As the financial markets saw yet another week of volatility, one phrase echoed through the minds of many: “This is where it starts to get fun.” Indeed, the past week was filled with more action than anticipated, especially for those with a keen eye on the numbers.
Gold’s price saw a spike, barely missing the milestone of 3000, as it surged to 2968 on Tuesday due to concerns over Trump’s tariffs. However, this spike was short-lived, and by the end of the week, Gold settled at 2894, showing a modest gain of +8 points for the week.
Meanwhile, fears of renewed inflation following Wednesday’s StateSide Consumer Price Index release led to a sell-off in Gold, erasing all gains made earlier in the week. The market was also abuzz with speculation about a potential Fed rate hike, given the recent inflationary trends.
The economic data continued to surprise as January’s inflation figures exceeded experts’ expectations, causing a stir in the financial world. The revisions to December’s numbers further added to the uncertainty, with the headline and core PPI figures seeing significant adjustments.
Despite the market’s ups and downs, Gold remains fundamentally undervalued, but technically overbought in the near term. The BEGOS Markets’ metric shows Gold as being overvalued, while technical indicators point to an extended period of overbought conditions.
As inflation takes center stage, concerns about stagflation linger, with recent data suggesting a potential slowdown in economic growth. The stock market, on the other hand, remains near its all-time high, driven by Fed policy and investor sentiment.
Looking ahead, the Fed’s next move remains uncertain, with conflicting views on the need for rate cuts or hikes. The upcoming inflation data will be crucial in determining the Fed’s next steps and how it could impact the financial markets.
Overall, the past week was a rollercoaster ride for investors, with Gold’s price spike and inflation concerns dominating the headlines. Understanding these trends and their implications is essential for anyone looking to navigate the volatile financial markets.
Gold and Silver Market Analysis: Is the Rally Sustainable?
Gold and Silver have seen a significant uptrend over the past three months, with Gold showing a particularly strong move. However, Friday’s market performance might indicate a potential technical setback rather than a clear path towards the next milestone of 3000.
Currently, the precious metals are technically overbought and are largely being influenced by headline news, as shown in our hourly chart analysis. It is important to keep an eye on the trend consistency indicators to gauge the market sentiment accurately.
Examining the 10-day Market Profiles for Gold and Silver, we can see that Gold (currently at 2894) faces a challenge below 2888, while Silver (currently at 32.66) has dipped below its dominant volume support level of 32.75.
Looking ahead, it seems that a downward trend might be in store for Gold in the coming week, although the current price movement is heavily influenced by news events. Despite this, Gold’s year-to-date performance remains positive.
The Gold Stack
– Gold’s Value per Dollar Debasement: 3837
– Gold’s All-Time Intra-Day High: 2968 (11 February 2025)
– 2025 High: 2968
– 10-Session directional range: up to 2968 (from 2802) = +166 points or +5.9%
– Gold’s All-Time Closing High: 2957 (13 February 2025)
– Trading Resistance: notable overhead Profile nodes 2931 and 2944
– 10-Session “volume-weighted” average price magnet: 2903
– Gold Currently: 2894 (expected daily trading range: 34 points)
– Trading Support: most notably 2888, then 2875
– 2025 Low: 2625 (06 January)
– The Weekly Parabolic Price to flip Short: 2607
– The 300-Day Moving Average: 2424 and rising
– The 2000’s Triple-Top: 2089 (07 Aug ’20); 2079 (08 Mar ’22); 2085 (04 May ’23)
– The Gateway to 2000: 1900+
– The Final Frontier: 1800-1900
– The Northern Front: 1800-1750
– On Maneuvers: 1750-1579
– The Floor: 1579-1466
– Le Sous-sol: Sub-1466
– The Support Shelf: 1454-1434
– Base Camp: 1377
– The 1360s Double-Top: 1369 in Apr ’18 preceded by 1362 in Sep ’17
– Neverland: The Whiny 1290s
– The Box: 1280-1240
Looking ahead, the upcoming week’s economic data release is expected to be moderate, with the Conference Board’s Leading Indicators for January being a notable event on Thursday (20 February). While the consensus is for a flat performance in January, it is important to keep a close watch on these lagging indicators to understand the market trends.
Ensure that your Gold and Silver portfolio shares are diversified to mitigate risks and maximize potential returns!
Cheers!