Markets stabilise and metals look hungry

23 August, 2023

As at 9am, AEST

Gold Spot Price $AU2957

Silver Spot Price $AU36.60

Platinum Spot Price $AU1451

After a tough couple of weeks for metals, it seems like pricing has settled down and aligned with the 200-day moving average (200MDA). Given the relentless bad news on a global scale, it's a bit of a relief to see a relatively calm day today. As the markets take a breather in their recovery efforts, the upcoming week will be crucial in determining whether we're in for more downward pressure or if we're ready to bounce back from the recent market lows.

The US housing market appears to be holding steady, mostly thanks to new homes. Treasury yields are stronger than expected, which is putting some strain on equities. However, we're essentially in a wait-and-see mode, anticipating more economic data before any significant market movements.

All eyes are also on oil prices, with everyone patiently waiting to see which direction they'll take. If oil follows the lead of its 200MDA, we might see price weakness, potentially impacting metals' pricing. But if we're witnessing the lower end of the 200MDA trend, there's a chance for an explosive increase in prices, which could then drive both metals and commodities higher, launching us into a bull cycle.

In the recent weeks following China's economic troubles, the US dollar has been strengthening consistently. This dollar strength translates to a weaker Aussie dollar, which, in turn, reduces our buying power for various goods and services. This further compounds the already existing challenges of rising costs in Australia. While we might have managed to rein in inflation somewhat, we have limited control over the strengthening US dollar.

As we look ahead, our focus is firmly on oil and the trajectory of the US dollar, as these factors could hold the key to what happens next in the market.

Here’s today’s pricing charts.

ASX200

Oil with 200MDA

Gold daily, with 200MDA

Silver daily, with 200MDA