Modest Price Gains For Gold as Key U.S. Inflation Report Looms

(Kitco News, Tues. July 12th, 2021) – Gold prices are modestly up in early U.S. trading Tuesday, while silver prices are a bit weaker. Traders were awaiting the U.S. economic data point of the day: the June consumer price index report, seen up 0.5% from May and up 5.0%, year-on-year. Some U.S. and global inflation readings have been running hot lately and a hotter U.S. CPI reading today would likely impact markets, including pushing bond yields up. August gold futures were last up $3.30 at $1,809.30 and September Comex silver was last down $0.044 at $26.195 an ounce.

Global stock markets were mostly higher overnight. The U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins and at or near record highs. The global markets are still not paying serious attention to the new Covid-19 variant that is spreading in some parts of the world and is beginning to threaten some regional economies. Focus this week is on U.S. corporate earnings reports.

China reported surprisingly strong export data Tuesday. June exports rose 32.2% versus 27.9% in May, year-on-year and 23.0% forecast. China’s imports in June rose 36.7% versus 51.1% in May and 25% forecast.

The key outside markets today see the U.S. dollar index higher, while Nymex crude oil prices are up a bit and trading around $74.25 a barrel. The International Energy Agency overnight warned that global oil markets are set to “tighten significantly” unless there is an increase in production. With OPEC and its allies failing to reach agreement on increased output, crude oil inventories are set to fall even more. The 10-year U.S. Treasury note yield is presently fetching 1.365%.

Other U.S. economic data due for release Tuesday includes the weekly chain store sales index and the Johnson Redbook retail report, the NFIB small business optimism index, real earnings and the monthly Treasury budget statement.

Technically, gold futures bulls have the slight overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $1,850.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the June low of $1,750.10. First resistance is seen at the overnight high of $1,813.80 and then at the July high of $1,819.50. First support is seen at $1,800.00 and then at Monday’s low of $1,791.00. Wyckoff’s Market Rating: 5.5

The silver bulls and bears are on a level overall near-term technical playing field. Silver bulls’ next upside price objective is closing September futures prices above solid technical resistance at $28.00 an ounce. The next downside price objective for the bears is closing prices below solid support at the June low of $25.58. First resistance is seen at the overnight high of $26.44 and then at $26.75. Next support is seen at last week’s low of $25.82 and then at $25.58.

Posted by :

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com