Gold reached a fresh record high before simmering tensions over Greenland ebbed somewhat

OUTSIDE MARKET DEVELOPMENTS: President Trump's highly anticipated speech at the WEF in Davos is moving markets today. While Trump's comments certainly stoked the anger of many, he explicitly ruled out using military force to acquire Greenland.

Additionally, the President announced via Truth Social that the U.S. will not impose additional tariffs on Europe after "a very productive meeting" with Mark Rutte, Secretary General of NATO, in which they formed "the framework of a future deal with respect to Greenland and, in fact, the entire Arctic Region." We have not seen any specifics on the "framework" at this point, and Rutte has not commented publicly yet, but you can bet the press corps is after him.

Markets have swung decisively back to risk-on. A significant portion of yesterday's "sell-America" trade has been unwound today.

Adding to Tuesday's market turmoil was a rout in Japanese Government Bonds that caused long yields to surge to record highs. Investors fled Japanese debt amid fears over PM Takaichi's call for a snap election, and proposed fiscal stimulus, including a two-year suspension of the 8% consumption tax on food, which could worsen Japan's already massive debt burden.

Japanese markets calmed somewhat today, but 40-year yields remain above 4%, a handle that had never been seen before Monday. Volatility is likely to remain high ahead of the February 8 election.

Speaking in Davos, Ken Griffin, the founder and CEO of Citadel, warned that "the bond vigilantes are back" and could "come out and extract their price" if fiscal irresponsibility continues. Japan seems to be in the crosshairs currently, but the U.S. could be a ripe target too if we don't start making some inroads toward improving our fiscal situation.

While the U.S. economy remains resilient, there's plenty to be concerned about. The U.S. national debt is expected to exceed the $40 trillion threshold sometime this year, an ever-increasing drag on growth. Add to that the looming threat of another government shutdown, concerns about Fed independence, and a continuation of the macro de-dollarization trend seems likely.

MBA Mortgage Market Index jumped 14.1% in the week ended 16-Jan, versus +28.5% in the previous week. The 30-year mortgage rate dipped to a 16-month low of 6.16%, versus 6.18% in the previous week.

NAR Pending Home Sales fell 9.3% in December, well below expectations of -0.3%, versus +3.3% in November. The decline ended a four-month streak of gains and marked the steepest drop since April 2020 during the pandemic. “[T]he decline in pending home sales could be a result of dampened consumer enthusiasm about buying a home when there are so few options listed for sale,” said NAR Chief Economist Lawrence Yun.

Construction Spending rose 0.5% in October, above expectations of +0.1%, versus -0.6% in September. 


GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CT: +$103.46 (+2.17%)
5-Day Change: +$219.13 (+4.74%)
YTD Range: $4310.83 - $4,887.59
52-Week Range: $2,732.23 - $4,887.59
Weighted Alpha: +79.85

Gold extended to a new record high of $4,887.59 in overseas trading on Wednesday amid ongoing safe-haven demand in advance of President Trump's speech in Davos. While I would hardly call his comments "calming," the assurance that Greenland would not be taken by force and the walking back of tariff threats eased tensions enough to knock the yellow metal off its highs. Nonetheless, gold is on track for a third straight higher close.



The breach of the $4,800 target and the approach to $4,900 bolsters confidence in the bullish scenario that calls for the attainment of the long-standing $5,000 objective, which happens to correspond closely with the next Fibonacci level at $4,993.96. Beyond that, focus would shift to $5,180.79.

With 2026 off to a gangbuster start, it's not surprising to see that gold-backed ETFs saw solid inflows of 35.8 tonnes last week, with 27.2 tonnes attributed to North American investors. It was the eleventh straight weekly inflow and the largest since 17-Oct'25.



Besides the technical overbought condition, there doesn't seem to be much to suggest we're close to a top in gold. While tensions over Greenland seem to have abated, there are still plenty of geopolitical hotspots to worry about. As noted above, the de-dollarization trade could gain traction amid concerns about another potential government shutdown and a politicized Fed. Meanwhile, the Fed is still expected to ease this year, perhaps as much as 50 bps, and the global central banks' buying spree is likely to continue.

The low for the day at $4,757.50 looks to be well protected heading into the close. This level protects lows from earlier in the week at $4,660.05 and $4,599.09.  


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CT: +$0.183 (+0.19%)
5-Day Change: +$0.155 (+0.17%)
YTD Range: $71.429 - $95.865
52-Week Range: $28.565 - $95.865
Weighted Alpha: +261.31

Silver was largely corrective on Wednesday, retracing from Tuesday's record high at $95.865 and registering its first lower close of the week. However, losses continue to be viewed as corrective and stalled shy of the $90 support zone. By the close, the white metal was nearly 3% off the intraday low as volatile conditions persisted.



Concerns about that volatility and profit taking ahead of the holiday weekend resulted in net outflows from SLV last week of  $686.41M, or approximately 7.61 Moz. A sustained correction or period of consolidation would likely draw those investors back in, but it could just as easily be another bout of FOMO if the rally continues.

The next upside target is $96.571 based on a Fibonacci projection. Above that, $100 is very much in play.

Today's low at $90.446 bolsters the significance of the whole $90 zone.  Below that, I'd be watching $86.439 and the rising 20-day MA at $82.970.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
312-549-9986 Direct/Text
[email protected]
www.zanermetals.com

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.