With much of the attention on Bitcoin becoming a potential replacement for gold (which we don’t agree with) silver has been almost forgotten. The grey precious metal has been trading inside a very narrow range with no clear directional bias for a very long time now.
The markets have extended their winning streak for the fourth session, with Europe also trading higher. The Dow has crossed over the 25,000 mark again with the S&P 500 trading above 2760 at the time of writing.
Gold, silver, and mining stocks moved higher once again yesterday and the former even managed to move above the declining trend channel. Breakouts are bullish and thus the outlook for gold improved significantly… Or did it? Gold’s price in terms of the euro and gold’s relative performance to silver and mining stocks make replying to the above question quite easily.
Major U.S. benchmarks grinded forward in the second half yesterday and added gains overnight. Buzz that China offered to add $25 billion in purchases of U.S. goods this year turned a potentially dulling tape back north before the close. The offer comes days after Commerce Secretary Wilbur Ross left Beijing but also surfaces question marks to the $70 billion in purchases spoken of weeks ago.
Ahead of next week’s major central bank meetings and key data releases, there have been some interesting moves in the markets with the euro/U.S. dollar currency pair in particular showing relative strength. Although the Federal Reserve is almost certain to raise interest rates next week, it is the European Central Bank which all of a sudden is looking to be the more anticipated meeting.
Investors should buckle up for a potential showdown as trade is expected to be a major talking point throughout the summit. With escalating trade tensions seen as a significant threat to global economic growth, this could be a G7 meeting like no other.
Al Brooks provides bar-by-bar analysis on a five-minute chart of the previous day’s prices action in the E-mini S&P 500. This is his analysis forAl Brooks provides bar-by-bar analysis on a five-minute chart of the previous day’s prices action in the E-mini S&P 500. This is his analysis for Tuesday, June 5, 2018.