Week Ending January 1, 2022
GMRgold.com - the precious metals leading gold, silver, platinum and palladium experts, provides a weekly update in the precious metals market.
Gold: It is apparent that the Bears took a more extended vacation than the Bulls as is evident with the moves in Gold over the Holiday week. With the battle line firmly drawn at the psychological level of $1,800.00 per ounce for months, the yellow metal managed to close above this milestone each of the five trading days the last week of the year, only to find its way back to $1,799.52 on the first day of business in 2022.
There is a clear consolidation occurring at the $1,800.00 mark and given the length and breadth of the skirmishes one should realize the breakout will be something to behold when the Bulls do indeed win this battle.
Silver: Silver still struggles to find any direction following its discouraging collapse in the second half of 2021. Trading for almost the entire 4th quarter in a tight range around $22.00 per ounce, the shiny metal could use some positive manufacturing news to offer some assistance in another rally towards $30.00.
With an administration hell bent on feeding rather than defeating inflation, one might expect Silver to react as fundamentals would dictate. We all wait with bated breath. Until then, expect more of the same with trading languishing between $22 and $25 for the next two quarters.
Platinum: The platinum family of metals offer no distraction to the snoozer which is Silver. They too look for some sort of twinkle of a signal that the Covid labor shortage will cure itself and global production of any kind will show signs of recovery over the relentless headlines.
The Dow Jones Industrial Average continues its march towards 40,000 while turning a blind eye to fundamentals. The uneducated investor is oblivious to the fact that the DJIA is a measure of 30 stocks representing some 2,800 companies traded on the New York Stock Exchange.
It is hard not to enjoy the euphoria which is an unending uptrend in stocks defying all odds, but just like the children’s birthday party game, when the music stops playing, there will be fewer chairs than investors.
This is a slow week for economic indicators to be released which typically puts the markets in state of suspended animation. Next week, however, is a busy week for releases and expect fireworks in every index.
Geopolitical news is dominated still by the show of strength on the Ukrainian border by Russia. The ball is in NATOs court with the possibility of extending membership to Ukraine. Vladimir Putin is counting on more non-action from the United States and more fear from NATO. It is wintertime in the region, it should be clear, the 100,000 Russian troops battle ready on the border are not simply an exercise. This could affect all markets worldwide with flights to safety.
Insure your portfolio with tangible assets lead by Gold and Silver Coins and Bullion. In every previous economic downturn, those that followed this practice survived the pain better than those who did not.
WORD OF THE WEEK – Stagflation - Stagflation is a period when slow economic growth and joblessness coincide with rising inflation. As the global economy reopens, growth has picked up in the world’s big economies. The worry is that higher prices on everything from a gallon of gasoline to an hour of labor could slow that recovery. Those price increases, in turn, could force central banks to raise borrowing costs at a faster clip to rein in inflation, placing even more drag on GDP.
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