The marketplace on Thursday is still digesting Powell’s comments from Wednesday. In is his speech to House lawmakers he said since the June FOMC meeting uncertainties, including world trade tensions, global growth and very low inflation, continue to cloud the outlook for the U.S. economy and these matters are not improving. He said the U.S. economic outlook is solid, but the prospects for other major world economies are worrisome. The marketplace read his remarks as fully dovish on U.S. monetary policy, which in turn strongly suggests the Fed will cut U.S. interest rates as soon as this month. That’s a bullish scenario for U.S. Treasuries, the U.S. stock market, and commodities markets, including the precious metals. However, it was a bearish development for the U.S. dollar on the foreign exchange market. Powell speaks to a U.S. Senate panel today.

Gold prices are also seeing safe-haven demand Thursday. Reports said a British warship had to step in and rescue a U.K. oil tanker that was being harassed by several Iranian vessels in the Strait of Hormuz.

In overnight news, the Bank of England said the risk of a “no deal” on Brexit has hurt the U.K. economy.

The key “outside markets” today see Nymex crude oil prices higher and trading just below $61.00 a barrel. The U.S. dollar index is lower early today.

Technically, the gold bulls have the firm overall near-term technical advantage. A six-week-old uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close in August futures above solid resistance at the June high of $1,442.90. Bears’ next near-term downside price breakout objective is pushing August futures prices below solid technical support at the July low of $1,384.70. First resistance is seen at today’s high of $1,429.40 and then at $1,435.00. First support is seen at $1,410.00 and then at $1,400.00.

Posted by :

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com