Gold price firmer following as-expected U.S. inflation report

(Kitco News, Wed. Aug. 11th, 2021) – Gold prices are moderately higher in early U.S. trading Wednesday, while silver prices are slightly down. The metals markets showed little reaction to a key U.S. inflation report that was just released. The precious metals bulls appear to have stabilized their markets following recent selling pressure. October gold futures were last up $8.00 at $1,736.30 and September Comex silver was last down $0.097 at $23.295 an ounce.

The U.S. consumer price index (CPI) report for July, just out, came in at up 0.5%. That was right in line with the consensus forecast and compares to a rise of 0.9% in June. Year-on-year, the CPI was up 5.4%, also right in line with market expectations.

Global stock markets were mixed overnight, with European indexes at or near record highs and Asian shares a bit weaker. The U.S. stock indexes are pointed to mixed to weaker openings when the New York day session begins, but are still near their recent record highs. The U.S. Congress is showing some bipartisanship and is set to pass major budget and infrastructure spending bills from the Biden Administration, and that is keeping the marketplace generally upbeat at mid-week.

For the moment, traders and investors are looking past the worrisome rise of the new Covid variant, which is threatening to slow the global economic recovery, especially in China.

The key outside markets today see the U.S. dollar index firmer and hitting a 4.5-month high overnight. Nymex crude oil futures prices are lower and trading around $67.50 a barrel. The yield on the benchmark U.S. 10-year Treasury note is presently fetching 1.369%.

Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, real earnings, the monthly Treasury budget statement and the weekly DOE liquid energy stocks report.

Technically, October gold futures bears have the overall near-term technical advantage amid the recent steep downdraft in prices. Bulls’ next upside price objective is to produce a close above solid resistance at $1,800.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at this week’s spike low of $1,676.40. First resistance is seen at $1,750.00 and then at this week’s high of $1,763.00. First support is seen at Tuesday’s low of $1,716.50 and then at $1,700.00.

The silver bears have the solid overall near-term technical advantage. Prices are in an 11-week-old downtrend on the daily bar chart. Silver bulls’ next upside price objective is closing September futures prices above solid technical resistance at $25.00 an ounce. The next downside price objective for the bears is closing prices below solid support at this week’s low of $22.295. First resistance is seen at Tuesday’s high of $23.675 and then at $24.00. Next support is seen at the overnight low of $23.19 and then at $23.00.

Posted by :

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com