(Money Metals Exchange) As the Dow Jones Industrials surged to the stratospheric 30,000 level during this holiday-shortened trading week, traders continued to unload gold positions.
Gold prices broke below a support line at $1,850 on Monday. The market descended downward to test the $1,800 level – which also happens to be where an uptrending 200-day moving average line comes into play. So perhaps the monetary metal will be due for a bounce heading into December.
But as of this Black Friday recording, gold is below $1,800 now as it’s selling off during this thinly traded day after Thanksgiving, big surprise there. Spot gold currently checks in at $1,791 an ounce, down a healthy 4.6% for the week. Silver is also taking it on the chin today and shows a weekly loss of about $1.50 or 6.1% to trade at $22.78 per ounce.
The platinum group metals are outperforming, with platinum up 2.3% this week to trade at $981. Its sister metal palladium is up about $100 or 4.1% on the week to command $2,448 per ounce.
And finally, on the day the Dow hit 30,000, copper prices hit $3.30 per pound to mark a slight new 7-year high. If the apparent breakout holds, then copper may be headed toward its all-time high of $4.70 in the months ahead.
So, it’s a bit of a mixed picture in the metals space. Industrial metals are gaining momentum while gold and silver are struggling to find footing after spiking this summer.
Wall Street’s post-election exuberance is, for now, stealing precious metals’ thunder. Stock market bulls cheered Joe Biden’s announcement that he intends to make former Federal Reserve chair Janet Yellen his Treasury Secretary.
Over on CNBC, it was a literal love fest for Yellen and current Fed chairman Jerome Powell. Stock market cheerleader Jim Cramer could barely contain himself.
Wall Street’s over the top reverence of central planners may seem strange. It may ultimately be unhealthy for the proper functioning of markets. But all that matters at the moment is that stocks are going higher.
At some point we suspect that all the stimulus being pumped into financial markets will bring negative side effects that most CNBC viewers are unprepared for.
If Joe Biden is ultimately sworn in as President next January, a Treasury Department helmed by central banker Janet Yellen would effectively cement the ongoing merger between the supposedly “independent” Federal Reserve system and the federal government. Whatever the Biden administration wants from the central bank, it will provide.
A narrowly Republican-controlled Senate will be powerless to stop the implication of modern monetary theory or something akin to it. We can expect massive commitments by the Fed to monetize ever-growing trillions worth of government deficits.
When the current euphoria in the stock market fades, precious metals will be one of the few viable places for investors to seek protection from currency debasement and inflation.
