Metals decline on tightening worries as Powell reinstated
11:34, 23 November 2021
Precious metals suffered significant losses yesterday after Jerome Powell was re-appointed to lead the Federal Reserve (the Fed) for a second four-year mandate, boosting market expectations over stricter monetary policies.
Gold dropped below the psychological level of $1,800 per troy ounce (oz), down 0.68% on the day, while silver slipped by nearly 2% to 23.75 USD/oz as of 12:00 GMT.
Palladium sunk more than 4% yesterday and edged 0.8% lower today to $1,929/oz, while platinum retraced more than 2% yesterday and today was down 0.8% to $995/oz.
Meanwhile, industrial metals rebounded, fuelled by expectations of stimulus measures to support growth in China. Non-precious metal copper benefitted from an improving demand outlook, and was 0.5% up to $4.42 per pound.
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Metal commodities performance heatmap – 23 November 2021
Metal commodities performance heatmap as of 23 November 2021, 12:00 GMT – Credit: Capital.comGold
As of writing, spot gold was last at $1,794 per ounce, down 0.68% from a day before.
Yesterday, gold recorded its third-worst daily performance since 2021, weakening as much as 2.3% on worries that Powell’s reappointment could have the effect of frontloading policy tightening next year.
The US dollar (DXY) reached new year-to-date highs (96.50), while the yield on the US 10-year Treasury bonds rose to 1.65%.
After yesterday’s sell-off, gold prices are 5.5% lower since the beginning of the year. Spot gold is now hovering around its 50-day simple moving average (SMA) and is 8.4% below its 12-month highs.
Gold technical levels:
- 52-week high: $1,959
- 52-week low: $1,678
- 50-day moving average (one-day chart): $1,789
- 200-day moving average (one-day chart): $1,792
- 14-day relative strength index (RSI) (one-day chart): 43.66
Silver
Spot silver traded at $23.8 per troy ounce, down 2% from the previous day, extending its negative weekly performance of -4%.
The value of the silver is almost 10% lower year-to-date. Spot silver is still 20% below its 52-week highs ($29.89), and its 50-day simple moving average (SMA) sits 1% below current prices.
Silver technical levels:
- 52-week high: $29.89
- 52-week low: $21.44
- 50-day moving average (one-day chart): $23.54
- 200-day moving average (one-day chart): $25.30
- 14-day relative strength index (RSI) (one-day chart): 44.25
Chart of the day: Gold posted its third worst day in 2021
XAU/USD One-day rolling-price % change – Credit: KoyfinCopper
Copper was last at $4.42 per pound, up 0.6% on the day.
Yesterday, the People’s Bank of China left its key policy rate unchanged, but provided easing signals to stimulate the growth of the Chinese economy. Industrial metals rebounded on hopes of an improving demand outlook.
Copper prices are now up 1.6% from the previous week, but still 2.3% lower than a month ago. Copper remains the best performer among metal commodities year-to-date (+25%).
Copper technical levels:
- 52-week high: $4.90
- 52-week low: $3.26
- 50-day moving average (one-day chart): $4.37
- 200-day moving average (one-day chart): $4.33
- 14-day relative strength index (RSI) (one-day chart): 52.02
Platinum
Platinum was last at $999 per troy ounce, down 1.6% from yesterday’s levels.
The value of platinum dropped 4.3% from a month ago, and is now 6.6% lower since the beginning of the year. Platinum is trading 25.3% below its 12-month highs, and the 50-day SMA seats 4.4% above current prices.
Platinum technical levels:
- 52-week high: $1,337
- 52-week low: $901
- 50-day moving average (one-day chart): $1,045
- 200-day moving average (one-day chart): $1,023
- 14-day relative strength index (RSI) (one-day chart): 23.52
Palladium
Palladium is down 0.3% to $1,945 an ounce.
Palladium recorded the worst weekly performance (-10.2%) among other precious metals, seeing its value fall by 17.7% year-to-date. It is now trading 35% below its 12-month high and 12% below its 200-day SMA.
Palladium technical levels:
- 52-week high: $3,017
- 52-week low: $1,842
- 50-day moving average (one-day chart): $2,016
- 200-day moving average (one-day chart): $2,481
- 14-day relative strength index (RSI) (one-day chart): 39.04