Market Report for Jan 9, 2020
It’s Saturday, January 9, 2021, and this your Gold, Silver, Bitcoin, and Stock Market report. What a week! With the Capitol riots in DC - incited by the outgoing Trump administration - many anticipated the markets to fall.
Instead, they all charged higher closing at all-time highs! The Stock Market likes the incoming Biden administration because more stimulus is coming. Bitcoin rallied to another record this week breaking and closing above $40,000 a coin.
The possibility of stimulus is pushing Bitcoin and other cryptocurrencies higher as many coin holders believe that the Stock Market rally is unsustainable due to the current fiscal policies. This is a classic market, Bulls vs Bears based on differences in monetary and fiscal ideology. Watch out everyone, this can get hairy!
Gold and Silver had a great start to the week. Both tested their immediate resistance lines only to close lower for the week. The money is moving out of the metal market into the Stock and Bitcoin market as the euphoria takes over.
Gold Chart
Gold started the first full week of 2021 strong only to get slammed later in the week. Gold closed down -3.11% to $1,834.09, a massive beating. Gold successfully tested and broke through its resistance (see chart) but failed and headed lower.
This is not good news for Gold at all. Its trend remains flat but it’s forecast to close higher to $ 1,912.44. The higher forecast is probably a small relief rally but chart patterns show a continuation of a downward trend for Gold. If the Stock Market continues to rally, we’d expect Gold prices to drift lower from here.
Weekly Gold Chart with Support and Resistance Lines
Silver Chart
Silver got slammed last week as it tested and failed to close above its resistance line. The attraction to the shiny silver luster might be getting tarnished a bit as people flock to the Bitcoin and Stock Market. Silver closed down -6.64% to 24.58. Its trend remains flat and our models are forecasting a higher close to $27.12 next week.
Just as with Gold, we believe this to be a small relief rally but the chart patterns all point to a lower price trajectory for Silver. Sell your silver rounds now boyz.
Weekly Gold Chart with Support and Resistance Lines
Gold to Silver Ratio Chart
The Gold to Silver ratio closed higher last week, up +3.78% to 74.61. This was in line with our forecasts last week but the trend remains down with next week’s forecast being 72.67. We expect this ratio to become very volatile over the next weeks if the Bitcoin and Stock Market continue to rally. The money will flow out of the Metal market and there will be arbitrage opportunities between the Gold and Silver Market.
A lower close for the ratio next week will indicate between the two metals, money might flow from Gold to Silver, or that Silver will have another volatile week.
Gold to Silver Ratio Chart
Btc To Usd Chart
Bitcoin blew the doors off everyone this week. Closing at another record high and with no signs of stopping, it closed up a whopping+ 38.88% to $40,797.60! There are no upside targets for Bitcoin as this coin is in the middle of a paradigm shift. The trend is up and prices are starting to look parabolic.
Euphoria is creeping into this market as the “fear of missing out (FOMO)” is strong here. Our models forecast a higher close for Bitcoin next week to the $41,796 level.
Weekly Bitcoin Chart with Support and Resistance Lines
Dow Jones Chart
All major indices in the Stock Market made new highs this week. The Dow Jones closed up +1.60% to 31,097.97, a phenomenal way to start the new year. Since breaking out of its last resistance 8 weeks ago (when Biden won the election), it’s been charging higher.
The trend remains up for the Dow Jones and we believe there still is room to grow after a healthy consolidation. The forecast for next week is a higher close to the 31,149.80 level.
Weekly Bitcoin Chart with Support and Resistance Lines
Nasdaq Chart
The tech-heavy Nasdaq has sustained itself throughout the Covid19 pandemic and continues to charge higher. Just like the Dow Jones and the S&P500, it’s made new records. The Nasdaq closed higher this week, up +2.43 to 13201.98. The trend is higher and we’re forecasting a slightly lower close next week to 13,007.88.
We are anticipating a consolidation for the stock market in the coming weeks as Trump leaves office and Biden assumes control. Look to DC for clues on how much stimulus will be coming.
Weekly Bitcoin Chart with Support and Resistance Lines
S&P500 Chart
The S&P500 hit new all-time highs. Prevailing trading wisdom is to buy stocks that are making all-time highs because they will continue to make all-time highs until they don’t. The S&P500 closes up +1.82 to 3,824.67 last week and it’s trend remains up. Our models are forecasting a lower close to the 3,799.78 level.
As we’ve written above, we anticipate a period of consolidation, however, long term models are pointing to higher closes for the Stock Market in 2021.
Weekly Bitcoin Chart with Support and Resistance Lines