Gold rose to a two-week high to an overnight peak of $1265, the most since May 1 as political turmoil in the United States reduced expectations of aggressive interest rate rises this year, pushed down U.S. bond yields and drove the dollar to its lowest in six months. Pressure on US President Donald Trump deepened after reports that he tried to interfere with a federal investigation. This follows a turbulent week after Trump fired FBI director James Comey and discussed sensitive national security information with Russia’s foreign minister, causing investors to question whether Trump can push through tax cuts and deregulation. From physical side SPDR Gold Trust, said its holdings fell 0.14 percent to 850.71 tonnes vs 851.89 tonnes on Wednesday. In terms of ounces, holdings fell to 27,351,091.55 ounces from 27,389,151.08. Meanwhile, a recent run of disappointing U.S. economic data, including inflation, retail sales and housing starts has also weighed on the dollar, tempering expectations for higher interest rates. Odds for a June rate hike dropped to around 60%, down from more than 80% a week ago, while odds for a second rate hike by December fell to 30% from around 50% in the preceding week. The Fed has signaled it intends to raise rates twice more this year, after a quarter-point hike in March. The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases. Now technically market is getting support at 1243.70 and below same could see a test of 1236.20 level, And resistance is now likely to be seen at 1254.60, a move above could see prices testing 1265.20.
Trading Ideas for the Day
* Gold trading range for the day is 1242.6-1254.2.
* Gold rallied as concern over US President Donald Trump spurred a sell off in emerging market currencies.
* President Donald Trump, striking a defiant tone after days of political tumult, denied colluding with Russia during his 2016 campaign.
* Gold pulled back from two-week highs after stronger US manufacturing and initial jobless claims data dented the ‘flight to safety’ trade.
Silver gained to settled at $16.74 a troy ounce, after hitting its highest since May 1 at $17.03 touching the strongest level in around two weeks as investors feeling increasingly nervous over the future of Donald Trump's U.S. presidency sought safe havens for their money. Silver prices, surprisingly, did not follow the gold prices and in fact had a period of consolidation and ranging yesterday. While the gold prices rocketed higher, the silver prices made a feeble attempt to break through the $17 region which was promptly sold into and now the prices sit below the $17, looking pretty weak. Silver markets had a very strong move during the day as initially shut higher, pulled back to the open at the day, and then slammed into the $17 level. Silver found a bit of resistance there, which of course is a large, round, psychologically significant number, and perhaps the market got a bit ahead of itself. A lot of this move would have been due to the panic over President Trump and the Russian speaking, and whatever is going on behind the scenes there. Ultimately, that has nothing to do with the Silver markets, and believe this automatic reaction will probably fade out. The recent string of controversies intensified doubts that Trump would be able to follow through on his campaign promises for tax cuts, deregulation and fiscal stimulus. The deepening political turmoil dampened demand for risk-sensitive assets, such as global equities, and sparked a rally in assets perceived as safe, such as the yen, bullion and U.S. Treasuries, which are often used as a hedge in times of political uncertainty. Now technically market is getting support at 16.56 and below same could see a test of 16.44 level, And resistance is now likely to be seen at 16.72, a move above could see prices testing 16.99.
Trading Ideas for the Day
* Silver trading range for the day is 16.4-16.8.
* Silver dropped despite investors feeling increasingly nervous over the future of Trump's US presidency sought safe havens for their money.
* Gold gained as speculation seen that Trump would be able to follow through on his campaign promises for tax cuts, deregulation and fiscal stimulus.
* President Donald Trump is facing heavy criticism for his supposed ties to Russia and handling of classified intelligence.
Crude oil prices rose in yesterday session settled up by 0.60%, at $49.35/oz pushing back toward monthly highs as calm returned to Wall Street following yesterday's panic over political turbulence. Crude oil gained on growing optimism that big producing countries will extend output cuts to curb a persistent glut in crude, with key benchmarks heading for a second week of gains. While oil prices have been trapped in a tight range in recent weeks as rising U.S. production has erased the effects of output cuts by the OPEC and other countries, including Russia. But market watchers are growing more confident that OPEC, Russia and other big producers will extend cuts of almost 1.8mbpd until the end of March 2018. U.S. producers are not party to any agreements capping production. On May 25, leaders from OPEC and other producing countries will meet in Vienna to decide on output policy. Now investors' optimism that OPEC would seek an extension of the current deal to cut global production offset concerns over the rising level of U.S. shale production. The EIA said Wednesday, crude oil inventories fell by 1.75mbls last week, which was the sixth-straight week of declining crude stockpiles but the dip in inventories fell short of expectations of a draw of around 2.4 million barrels. Despite the high level of compliance from OPEC members with the deal to rein in supply, global production remains above the five-year average, as non-OPEC members, who are not part of the supply-cut agreement have ramped up production. In its monthly report last Thursday, OPEC estimated that non-OPEC production this year would grow by 950,000mbpd. Technically market is getting support at 48.45 and below same could see a test of 47.59 level, And resistance is now likely to be seen at 49.86, a move above could see prices testing 50.41.
Trading Ideas for the Day
* Crude Oil trading range for the day is 47.6-50.4.
* Crude settled higher as investors remained optimistic that OPEC would reach an agreement to extend the current supply-cut.
* Prices have been trapped in a tight range in recent weeks as rising US production has erased the effects of output cuts.
* Saudi Arabia and Russia agreed earlier this week that production cuts needed to be extended for a period of nine months until March 2018.
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