Loading ...Traders Take The Higher Road
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(Kitco News) – Metals broke out of the holding pattern on Thursday, as traders are becoming less worried that the Fed may move in March. The dollar softened and gold broke up through resistance at $1,245, where it had struggled on three occasions over the past two weeks. Silver also hit our $18.25 target suggested about 10 days ago. President Trump’s fiscal plans may include a border adjustment tax, which will be necessary to offset the proposed tax cut. So if you can’t buy it in the US, you’ll pay 25% more from a foreign supplier, which would neutralize your tax cut. American workers will make a minimum wage of $15/hour and a large chunk of imports are from counties where the minimum wage is a fraction of that. The math so far doesn’t make sense, but let’s wait and see what the package looks like. The prospect should be higher inflation at a minimum and with the Fed likely behind the curve, gold is getting a further look by fund managers. I am about to board a flight back from Hong Kong, so I am literally flying by the seat of my pants with a suggested price range today. If gold can gain some momentum and maintain above the $1,255 level, further price action suggests a test of the $1,268 line. Silver’s next resistance line appears around the $18.65 area.”