Looking to the Futures
Gold futures surge by over 1% on Thursday morning.
The market has been optimistic that a peace deal between the United States and Iran is nearing as Iran says it's reviewing the latest U.S. proposal. Iran is expected to respond today Thursday the 7th. President Trump has been optimistic for the peace deal but also considering future military action if a deal is not reach.
Aside from the ever-changing geopolitical risks, the gold demand outlook remains high per the World Gold Council's Q-1 gold demand results. The first quarter's trends showed gold demand was 2% higher year over year at 1,231t and central bank purchases were up 3 percent year over year.
On the technology front, demand grew 1 percent in the first quarter to 82 tons with electronic demand increasing 3 percent year over year to 69t. Still demand for gold on the technology side is only making up about 7 percent of total demand.
Gold supply from mine production came in 2 percent up year over year at 885t. Recycling volumes increased as well by 5 percent as higher prices triggered sales in old jewelry and to no surprise demand for new jewelry was down to the lowest since the second quarter of 2020. Even still jewelry continues to be a leader in terms of demand.
Investment in gold pulled back year over year by 5%. Mostly this came from ETF demand as a pullback in March reversed most of the demand increase from January and February. However, investment in bar and coin increased to 474t, the second highest on record.
Silver futures are also on the move. Front month silver (/SIN26) are trading up just over 11.5% since the upward move started on Tuesday while copper futures (/HGN26) are trading up just over 6 percent since Tuesday.
Looking to the economic side of things, the ADP national report came out on Wednesday. The report showed an increase of 109,000 in U.S. private employment jobs, while annual pay increased by 4.4 percent year-over-year. The gold market has remained resilient despite strong labor market numbers.
Technicals
Today we have a chart of the 1-year, 1-day June Gold futures (/GCM26). Gold crossed over the 9-day SMA just yesterday and moved above the 20-day SMA on Thursday. Gold's all-time high occurred back on January 29th where the metal reached 5626.8 and after a sharp move down rebounded to 5434.1 on March 2nd, just as U.S. and Iran tensions began to rise. Gold is currently trading at 4743.8. RSI comes in at 52.34, while implied volatility sits at 25.76 percent.
Contract Specifications
Economic Calendar
Non Farm Payrolls APR 8:30 AM
Unemployment Rate APR 8:30 AM
Manufacturing Payrolls APR 8:30 AM
Nonfarm Payrolls Private APR
Fed Goolsbee Speech 11:05 AM
Baker Hughes Oil Rig Count MAY/08 1:00 PM
Baker Hughes Total Rigs Count MAY/08 1:00 PM
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