Until Friday this holiday shortened week has been rangy moving back and forth between $1280 and $1285 per oz. Today Gold took off opening just below $1290 at $1288.33 to be exact, and then moved up like a rocket to a high of $1306.94 before settling back just a bit. Currently trading right around the $1304 per oz level. This is the highest price in roughly 7 weeks. This strong bullish move is based on current and future uncertainty in trade relations and the hint by the U.S administration of additional tariffs on Mexico due to the Immigration problems at the border. These tariffs, if implemented could escalate into a trade war with Mexico and hurt the economy and future economic growth. This has created huge “safe haven” buying spree for Gold and other precious metals. This end of month bullish move also sets May up for the first monthly gain since January, perhaps ending the bearish trend for the last few months. The next resistance level is right around $1310. If gold can close above this level in the next week or so, $1320 pre oz would be the next major target, which is a long way from this week’s low of $1275.
Silver like Gold moved up strongly today, however the bullish move just got Silver back to the start of the week at $14.57, Tuesday’s open. Currently silver is trading at $14.57. This move up while bullish, is just within the weekly range of the last few weeks. So, no big news other than we may have found a bottom this week of $14.30, if precious metals continue to be bullish. The next higher resistance level is $14.80, which if hit would signify more of a sustained change in direction, from bearish to bullish.
Oil took another nosedive this week, after a big move lower last week. This bearish sentiment had been due to excess supply and concerns about economic growth. This week was more of the same, currently heading for the second highest weekly loss of the year. The move down continued today with the addition of a Friday morning announcement from the U.S administration lifting restrictions on farmers for the sale of higher Ethanol Blends of gasoline and year-round sales, instead of winter only. This helps farmers who may have been hurt by the recent tariff war with China, but this change is viewed by the oil industry as a setback, as biofuels like ethanol are competition for petroleum based fuels The impact is big enough there is even talk of suing the administration over the change. The bottom line here is that if supply is more abundant the price will be lower, which is good news good for consumers but a setback for the oil industry.
About Bill Poulos
Bill Poulos is an American investor, published author, financial educator, and a retired automotive executive. His company, Profits Run, was founded in 2001 by Bill and his son, Gregory Poulos. They disseminate articles and courses on safe investment strategies for wealth management. Bill stays abreast of current economic trends and contributes regularly to online platforms. He has a undergraduate degree in engineering from General Motors Institute and an MBA from the University of Michigan. Poulos recently expressed his admiration in Jeff Bezos’s leadership style. Bill has been married to his high school sweetheart, Karen, for 50 years. They have three sons and two grandbabies. They reside in Wixom, Michigan, where Profits Run is headquartered.