Weekly Gold Technical Analysis: US Economy Indicators Point Directly To Recession

Leading US indicators are now clearly pointing the US into a recession. March results sunk to -1.2%, the biggest decline in 3 years.

The LEI (Leading Economic Indicators) is a gauge of 10 indicators designed to show if an economy is getting better or worse.

While many forecasters are now feeling confident that the FED is complete with its interest rate rises, especially now seeing the above LEI results; Bankers have been commenting progressively that the roll-on effect from interest rate rises is yet to be fully felt. With many mortgage holders still yet to move from fixed interest to variable in the coming months, the full effects of the FED’s aggressive rate rising is still to become fully apparent.

And if the US is already measuring a -1.2% print for the month of March, it would be logical to assume that negative prints for the coming months will be commonplace.

“Economic weakness will intensify and spread more widely throughout the U.S. economy over the coming months, leading to a recession starting in mid-2023,” said Justyna Zabinska-La Monica, senior manager of business cycle indicators at the Conference Board.

While it is almost impossible to pick recessions, it is very easy to simply see that the economy is under considerable stress. Regardless if a recession materialises, the movement from risk-on assets like equities to risk-off assets like gold and silver is already underway. 

Gold responded strongly to the above news, rebounding from a mid-week low of US$1968 to its current price of US$2001. Silver responded likewise, rebounding from $US24.65 to its current position of $US25.23.

Gold Futures Technical Analysis

Gold Futures analysis continues to recommend a STRONG BUY over a weekly and monthly basis.

Technical Indicators - Monthly Projections

Disclaimer

Please note that past performance does not guarantee future results. This news and any links provided are for general information only and should not be taken as constituting professional advice from Jaggards.

Jaggards is not a financial adviser. We recommend you seek independent financial advice before making any financial decisions based on the information contained in this article.