Gold price rebounds as USDX backs down

(Kitco News,  Fri. July 28th, 2023) – Gold prices are moderately higher and silver prices just slightly up in early U.S. trading Friday. The metals are being supported by a lower U.S. dollar index on this day. August gold was last up $10.30 at $1,956.00 and September silver was up $0.083 at $24.45.

Asian and European stock markets were mixed in overnight trading. U.S. stock indexes are pointed toward higher openings when the New York day session begins. The U.S. stock indexes are at or near their highs for the year amid a summertime rally.

Traders are awaiting some more U.S. inflation data today, as the personal consumption expenditures (PCE) component of the personal income and outlays report will be closely scrutinized. The June PCE core index is seen coming in up 4.2%, year-on-year, versus a reading of up 4.6% in the May report.

In overnight news, the Bank of Japan made a surprise move that the global marketplace noticed. The BOJ made no interest rate change but it did say it will allow Japanese 10-year government bond (JGB) yields to be more “flexible” (meaning allowing yields to rise). That’s significant because the BOJ has been a last bastion for major central banks with ultra-low interest rates. The new BOJ stance on its yield-curve range hints to the marketplace that Japanese investors, who have been big holders of U.S. Treasuries, may now move more toward the JGBs and their potentially higher yields, and away from U.S. Treasuries. The Japanese yen rallied on the news.

The key outside markets today see the U.S. dollar index near steady. The USDX has made a solid rebound from the July low. Meantime, Nymex crude oil prices are slightly down and trading around $79.75 a barrel. The benchmark 10-year U.S. Treasury note yield is presently fetching 3.975%.

Millennials are the new gold bugs as recession fears support the precious metal – State Street’s George Milling-Stanley

U.S. economic data due for release Friday includes personal income and outlays, the employment cost index and the University of Michigan consumer sentiment survey.

Gold Price in US Dollars

Technically, the gold futures bulls and bears are on a level overall near-term technical playing field. A four-week-old uptrend on the daily bar chart has been negated. Bulls’ next upside price objective is to produce a close in August futures above solid resistance at the July high of $1,989.80. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $1,900.00. First resistance is seen at $1,960.00 and then at $1,975.00. First support is seen at this week’s low of $1,941.70 and then at $1,925.00. Wyckoff’s Market Rating: 5.0

The silver bulls have the slight overall near-term technical advantage. However, a four-week-old uptrend on the daily bar chart has been negated. Silver bulls’ next upside price objective is closing September futures prices above solid technical resistance at the July high of $25.475. The next downside price objective for the bears is closing prices below solid support at $23.00. First resistance is seen at $25.00 and then at this week’s high of $25.325. Next support is seen at this week’s low of $24.18 and then at $24.00.

Posted by:

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com