Homepage / Archived News or Quarterly News / 1st Quarter 2015
Date Posted: 4/29/2015 @ 4:32AM
For anyone who's interested in understanding how a market will move
in the future is to find out and learn how it has moved in the past.
Frederick Douglass
(1818 - 1895) was a former slave, who became a famous human rights
leader during the abolition movement, writer and statesman, once stated;
"Knowledge makes a man unfit to be a slave."
The charts analysis on the quarterly pages will help you to understand the volatility of the precious metals markets, whereas the news below the charts will help you to understand the fundamentals that moved the precious metals markets.
The combination of the charts and news help you in gaining "Knowledge" of these Markets, so you won't become a "Slave" to them.
The charts analysis and bullion news links on this page are devoted to the precious metals markets during the 1st Quarter of 2015.
However, there are also articles about the general direction of the financial markets and current events that affected the market during the quarter.
Immediately below this summary, there are quarterly, yearly, 3-year and 5-year charts for the US Dollar, Gold, Silver, Platinum, and Palladium, with simple Technical Analysis.
In addition, this page has a special section the U.S. dollar, gold and interest rates.
The financial news, audio, and videos links posted below the Palladium Spot Price Charts, were originally posted on the homepage during the 1st quarter of 2015.
The charts below are provided courtesy of
Bullion News
US Dollar Quarterly - Price Chart (January 1st, 2015 - March 31st, 2015)
During the 1st Quarter of 2015, the US Dollar continued its move up.
However, like the last quarter, the Dollar has started to consolidate
after each move upwards, which is healthy for any market, but after
hitting 100.71, the US Dollar looks like it might be topping out.
In
addition, the US Dollar's run up to the 100.71 occurred because of the
Market's anticipation of the Federal Open Market Committee (FOMC) statement release.
Bullion News
US Dollar 1 year - Price Chart (January 1st, 2014 - March 31st, 2015)
The Financial Media like to extract certain 'words or phrases' out of the Fed's statements to try to predict which way the Fed may or may not move in policy.
The words or phrases have included: 'Tapering, Considerable Time' and most recently 'Patient.'
It's all BS, the financial media use these word to rile the markets, and sad to say "it usually works."
The Fed changed their wording this time, but they basically said they're not going to raise rates.
Instead, the Fed said it was going to watch market data for future movements in the Federal Funds Rate.
After the Fed balked at raising rates, the US Dollar started to lose some of its strength.
The Dollar and Gold often move in opposite directions (but not always); you will be able to see this relationship in price movement in the Gold Analysis Section below.
US Dollar 3 year - Price Chart (January 1st, 2012 - March 31st, 2015)
One possible area for future US Dollar strength (besides an Interest Rate hike) has to deal with what happens to Greece's place in the European Union and what happens to its debt.
Nobody
really knows what will happen if they exit the Euro, some in the Market
say the Euro will fall, which would send the dollar higher.
However, others suggest that it may not be bad for the Euro if Greece exits the currency union.
One thing does seem
certain is that Greece's current government does not favor austerity.
The two infographics below have recently come out, they may help you to understand who Greece owes its debt to and what are the possible consequences if Greece defaults or exits the Euro.
Greece’s Debt and Who’s on the Hook in a Default
Assessing the Potential Risk of a Greek Default
US Dollar 5 year - Price Chart (April 1st, 2011 - March 31st, 2015)
Bullion News
If you pay attention to Technical Analysis concerning the US Dollar Index then you've probably seen the chart below.
It shows the Dollar chart breaking a thirty-year trend line in its recent rise in price.
US Dollar breaking Trend-line
44 year US Dollar Chart courtesy of: Trading Economics
In most markets, this would be a 'Great Trend,' but the Dollar has only the possibility of an Interest Rate hike to help it move higher.
This fact is quoted in this article here from GoldReporter.de.
In the article, the Bank of America / Merrill Lynch states the following; "We believe the upcoming increase in the federal funds rate is the only major hurdle for sustainable gold price rise."
This article states something I have pondered since July, and that is: The only reason for the rising US Dollar is due to the expectation of future Fed action in raising interest rates.
In the past, the reasons behind the strength in the US Dollar was due to reduced debt and strong economic growth.
Instead, we have 18 trillion in debt, an economy based on crony capitalism and Wall Street's expectation of higher interest rates.
In addition, if the Fed were to try to raise interest rates, it would be surprising if it was higher than a quarter of a percent (25 basis points | .25%).
They will be crossing their fingers if they do raise rates.
But, what will probably happen is that the Fed will continue to kick the can down the endless road for raising interest rates and the US Dollar will falter.
What I see in the chart below is a pattern of ups and downs in the dollar, that I think will continue.
In the early 80's, when the first peak in the dollar happened, it was from the Fed raising interest rates to tame inflation.
After the Fed brought interest rates down to normal levels, the dollar fell to normal levels.
In the late 90's, the peak in the dollar was caused by less government spending, lower deficits and higher interest rates.
The latest peak is from the "tapering of QE," the end of Quantitative Easing, in addition to the expectation of higher interest rates.
44 year US Dollar Chart courtesy of: Trading Economics
A few weeks ago, I asked Chris Kimble (a well-known Chart Technician who has the site Kimble Charting Solutions) why he hasn't questioned the US Dollars rise and possible fall using his "Eiffel Tower Pattern," he responded that he mostly uses the pattern on price charts that have risen by more than 100%.
See Chris Kimble's Eiffel Tower Pattern explained here.
The US Dollar has only risen by a little more than 20%, but I can see the Eiffel Tower Pattern in the Chart above, maybe you do to?
Concerning Interest rates, do you see the pattern of what has happened almost every time the Fed previously raised its Federal Funds rate?
Answer: the rate fell, because the Fed screwed the markets by raising rates too high, which made the economy stall, creating a recession.
Another obvious pattern in the chart above is that for the past 35 years interest rates have trended lower and lower.
The current business cycle is overdue for a pullback, a question to ask is; How small will the next Interest rate bump be (if any) before the next stock market correction or market recession?
The Fed is cornered like a scared cat, the data is telling them to do nothing, but Wall Street is anticipating an interest rate hike.
The Fed's biggest problem is that the US Dollar is the World's Reserve Currency and if they don't raise rates sometime soon, the markets will lose confidence in them and the US Dollar.
This is the Fed's worst nightmare because when this scenario plays itself out, and it will happen sometime in the future, the markets will sell US bonds and the market will dictate interest rates, not the Fed.
When this happens another currency will replace the US Dollar as the World's Reserve Currency.
The Fed has raised interest rates in the past due to inflation and economic growth, neither of which is showing up in the Fed's data, today.
In addition, besides Wall Street's expectations, there isn't any reason for them to raise interest rates, debt is skyrocketing, liquidity is still tight in the markets, companies are hoarding cash and spending is tight because people are not optimistic about their future.
The forces behind the rise in the stock market have been due to Quantitative Easing and Stock buybacks.
The Fed has nowhere to go and is cornered.
Bullion News
During the 1st Quarter of 2015, the price of gold moved up in the first three weeks to slightly above $1300 a troy ounce, then the price dropped over the next two months to $1140 a troy ounce.
The reasons for gold's price movement during this quarter were mostly dictated by international events and the policies of the world's central banks, the Fed and ECB in particular.
Gold Quarterly - Price Chart (January 1st, 2015 - March 31st, 2015)
The reason gold rose for the first several weeks was due to the unrest and fighting between Russia and the Ukraine, also, gold prices have historically moved up in January.
Then on January 22nd, the ECB (European Central Bank) announced that they were going to start their own version of QE - Quantitative Easing. See the article here.
The Euro and gold often move in the same direction, and both often (but not always) move in the opposite direction from the US Dollar.
Furthermore,
even though the European Central Bank's QE program wouldn't start until March 9th, once
the ECB announced the QE program, it started to bring down gold and the
Euro.
Gold also sold off due to market's anticipation of an
Interest Rate hike by the FOMC (Federal Open Market Committee) at its
March 2015 meeting, which will be held on the 17th and 18th of the month.
The Fed did not raise interest rates, even though many had previously predicted they would.
In
addition, the Federal Reserve Chair, Janet Yellen, repeatedly said
future rate hikes would be data driven, during her press conference.
Gold 1year - Price Chart (January 1st, 2014 - March 31st, 2015)
Bullion News
Gold's MACD (lower indicator), showed signs late in the 1st quarter of 2015 that the price of gold was going to be moving upward early in the 2nd Quarter of 2015.
Gold 3year - Price Chart (January 1st, 2012 - March 31st, 2015)
However, gold's RSI (upper indicator) shows that strength is looking to correct or consolidate, early in the 2nd quarter of 2015.
The $1180 Price Level is an important level for the price of gold, it acts more as a support level because almost every time gold has broken it, the price of gold has also moved back above it within a few days or a week at most.
Only when or if gold moves below $1180 and stays below it will it become a real Resistance Level for gold.
Gold 5 year - Price Chart (April 1st, 2011 - March 31st, 2015)
Bullion News
The markets are expecting to get a better understanding of how the Fed is going to move at the next FOMC meetings on June 16-17th and September 16-17th.
The
markets are solely dictated by the Fed, this isn't an opinion -- it is a
FACT, look for the price of gold to become more volatile before and
after each Federal Reserve meeting.
See the FOMC meeting schedule here.
Furthermore, on June 30th, the events concerning Greece are supposed to play out, so there maybe more market turmoil to follow after the end of June.
Bullion News
For the 1st Quarter of 2015, silver's price chart looks almost identical in movement to that of gold's chart.
Silver Quarterly - Price Chart (January 1st, 2015 - March 31st, 2015)
Bullion News
Silver like gold is a safe haven currency, but silver acts more as a commodity and an industrial metal than gold.
But this quarter showed silver's relationship with gold as a safe haven and precious metal.
Silver 1 year - Price Chart (January 1st, 2014 - March 31st, 2015)
Bullion News
During the quarter, silver stayed above its Support level of $15.00 a troy ounce and broke through its OLD Resistance Level of $18.00; creating a New Resistance Level of $18.50, when its upward movement, early in the quarter, stopped at that level.
In the 3 and 5-year charts below, you'll see why $18.00 a troy ounce was the old Resistance level for Silver. (Note: trend-lines are straight lines that connect two or more price points)
You can also see more about silver's $18.00 Resistance Level, which was a former support level in silver's price in the 3rd quarter of 2014 and in the previous quarters.
Silver 3 year - Price Chart (January 1st, 2012 - March 31st, 2015)
Bullion News
On the 5-year chart below, two trend-lines have been identified.
A smaller on is seen on silver's RSI (upper indicator) and a 4-year trend-line has been identified on silver's MACD (lower indicator).
There are no arrows to confirm these trend-lines (yet) because Silver is considered to be in a "Bear Market" and false breakouts are common during these markets.
Only the future will tell if a break in direction is in store for silver and the rest of the precious metals.
Silver 5 year - Price Chart (April 1st, 2011 - March 31st, 2015)
Bullion News
During the 1st Quarter of 2015, the price of Platinum moved in the same pattern as Gold and Silver.
Platinum Quarterly - Price Chart (January 1st, 2015 - March 31st, 2015)
Bullion News
Although Silver and Platinum often trade in the same patterns as gold, like a safe haven, their industrial uses and demand cause's the two metals to be more volatile, in their movement.
Platinum 1 year - Price Chart (January 1st, 2014 - March 31st, 2015)
Bullion News
Early in the quarter, the price of Platinum tried to test its new resistance level of $1295 a troy ounce, but it was unable to.
It created this resistance level in the 4th quarter of 2014.
Platinum 3 year - Price Chart (January 1st, 2012 - March 31st, 2015)
Bullion News
Platinum 5 year - Price Chart (April 1st, 2011 - March 31st, 2015)
Bullion News
Palladium is the one precious metal that is the hardest to follow or analyze because it does not follow in the other precious metal's price patterns.
Palladium Quarterly - Price Chart (January 1st, 2015 - March 31st, 2015)
Bullion News
During most of this quarter, the price of palladium was very choppy.
Palladium is the one precious metal that primarily trades as an industrial metal.
This is because most of its supply is used for automobile catalytic converters.
Although prices fell early in the quarter, the price of palladium rose above its 200day moving average (200MA - top red line) on March 1st.
Palladium 1 year - Price Chart (January 1st, 2014 - March 31st, 2015)
Bullion News
In early March, Russia, the world's largest supplier of the precious metal released a Palladium Export Report.
In
the report, Russia showed that they exported 21,600 troy ounces of
palladium in January, this was more than three times the average monthly
rate from the previous year.
See the article here.
Due to this supply report from Russia, the price of Palladium moved down throughout the end of the quarter.
However, the RSI (upper indicator) looked to be turning from its oversold position in the quarterly chart - above.
The MACD (lower indicator), on the other hand, continued sloping downward, but it looks to be getting over-extended to the negative.
In conclusion, in the next quarter palladium may be higher, but only time and demand will tell where the price of palladium will go in the future.
Palladium 3 year - Price Chart (January 1st, 2012 - March 31st, 2015)
Palladium 5 year - Price Chart (April 1st, 2011 - March 31st, 2015)
Bullion News
The charts above are provided courtesy of
The Quarterly News starts with the end of the quarter articles, first.
The Headlines without links, had the link removed from its original source; the Headlines was kept on the page due to relevancy.
For the Best Bullion Market News...
Bullion News & Commentary
1st Qtr - 2015 page
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