Dollar Recovering – Gold Range Bound

Gold and Silver Market Insights

The U.S. Dollar is in recovery mode, trading at 90.70 up from its most recent lows overnight at 90.11.

Normally, one would expect that when the dollar set a new low overnight, gold would have set a new high, but the price just stalled at $1344.50 in the CME February contract.

As one Gold trader put it, “the selloff in the U.S. Dollar just got tired and ran out of gas.” He must have studied philosophy in college, is my guess.

Nonetheless, the price of Gold should remain range bound until some new economic news hits the wires.

Over the last couple of days, the price of Palladium has been taking it on the chin as fund redemption picks up steam. At these levels, some new buyers have emerged stopping the recent decline. In the past two days, open interest has declined confirming that some nervous longs are heading for the exits. The Palladium EFP still trading at minus 8.50 at minus 4.50 indicating that the spot market is experiencing tight supplies.

Turning to Washington D.C.

No one knows what impact a government shutdown will have on the markets as most representatives say we need to finally get a firm budget in place. But if you listen to the rhetoric on both sides of the aisle, you must believe this is far from over. The deadline for a government shutdown is Friday at midnight.

Cryptocurrency Insight

Cryptocurrency markets in retreat mode as Bitcoin drops over 25 percent yesterday with the prospects of a regulatory crackdown continuing to emerge. Ripple, the second ranked cryptocurrency, dropped 40 percent and Ethereum lost 26 percent of its value. Today Bitcoin is trading under 10,000 after getting very close to 20,000 just a short time ago. More than 30 billion dollars has been shaved off Bitcoin’s value in the last 24 hours.

Have a wonderful Wednesday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.