Price gains for gold mild amid safe-haven demand

(Kitco News, Thurs. Aug. 19th, 2021) – Gold prices are trading modestly higher in early morning dealings Thursday, on some safe-haven demand amid keener risk aversion in the marketplace this week. Gains in the precious metal are being limited by a surging U.S. dollar index and slumping crude oil prices. October gold futures were last up $4.30 at $1,786.60 and September Comex silver was last down $0.072 at $23.35 an ounce.

Global stock markets were mostly lower overnight. The U.S. stock indexes are pointed to solidly lower openings when the New York day session begins. The U.S. stock index bulls are fading this week and need to stop the bleeding very soon to avoid near-term technical damage being inflicted. Risk-off attitudes are in play this week. It appears the summertime doldrums have come to an abrupt and early end this year. The surging coronavirus delta strain is keeping traders and investors tentative, especially heading into what history shows can be the rough months of September and October for the stock markets. The chaos in Afghanistan and the botched U.S. pullout are also causing market jitters. And Wednesday afternoon’s FOMC minutes showed a still wary Fed that remains concerned about the effects of the pandemic on economies and financial markets. The Fed also continues to lean toward tightening its monetary policy as early as this fall. Traders and investors are looking ahead to the annual Federal Reserve symposium in Jackson Hole, Wyoming, next week. More clarity on U.S. monetary policy and the timing of any policy moves are likely to be revealed at that meeting.

The key outside markets today see the U.S. dollar index higher and hitting a 10.5-month high overnight. Nymex crude oil futures prices are sharply lower, hit a 2.5-month low overnight and  are trading around $63.00 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching 1.243%.

U.S. economic data due for release Thursday includes the weekly jobless claims report, the Philadelphia Fed business survey and leading economic indicators.

Technically, October gold futures bulls have the slight overall near-term technical advantage and have momentum on their side. 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 $1,700.00. First resistance is seen at this week’s high of $1,795.00 and then at $1,800.00. First support is seen at this week’s low of $1,769.80 and then at $1,760.00.

The silver bears have the solid overall near-term technical advantage. Prices are in a three-month-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 the overnight high of $23.515 and then at $24.00. Next support is seen at the overnight low of $23.08 and then at $23.00.

Posted by :

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com