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(Kitco News) – Gold prices are moderately lower in early US trading on Thursday, in a routine corrective pullback after hitting a 7.5-year high of $ 1,796.10 on Wednesday. Risk appetite is declining later this week and that is bullish on safe metals. Don’t be surprised to see traders come in to buy the falling prices. August gold futures lost $ 7.40 an ounce to $ 1,767.40. Comex silver prices in July fell $ 0.15 to $ 17.52 an ounce.
World stock markets mixed to drop in overnight trading. US stock indices point to steady or weaker openings as the New York day session begins, after heavy losses on Wednesday. The Covid-19 pandemic appears to be spreading at a more alarming rate again in many countries, including the United States. That has eroded the confidence of traders and investors later this week.
Many health experts say two months of progress in the US has been thrown out the window because companies opened too early and Americans are not vigilant enough because they suffered “Covid fatigue.” It seems unlikely that the United States will crash as it is seen in the spring. Still, the troubling rise in infections in the past two weeks could halt the rapid economic recovery in the United States since companies began reopening. That is what has the US stock indices selling.
Another concern for the market is the rumors that the US could implement more trade tariffs against the European Union and the United Kingdom. The US and China (the world’s two largest economies) have already strained trade relations and other issues.
The market is also said to be starting to feel that President Trump is in danger of losing his re-election bid in November. A victory for Democrat Joe Biden would likely see rich and corporate American tax increases, as well as more corporate regulations, bearish for the stock market.
Today’s major external markets see Nymex crude oil prices weaker and trading around $ 37.50 a barrel. The US dollar index is higher earlier today. The yield on the benchmark 10-year U.S. Treasury note is currently around the 0.68% level.
It’s a busy day for U.S. economic data on Thursday, including the weekly unemployment claims report, the third estimate of first-quarter gross domestic product, the leading economic indicators report, durable goods orders, and the Kansas City Fed manufacturing.
Technically, gold bulls have the solid short-term overall technical advantage. Bulls’ next upside price objective is to produce a close in August futures above solid resistance at $ 1,800.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $ 1,750.00. The first resistance is seen at the nightly high of $ 1,779.60 and then at this week’s high of $ 1,796.10. First support is seen at the nightly low of $ 1,764.10 and then at this week’s low of $ 1,753.50. Wyckoff Market Rating: 8.0
July silver futures bulls have the overall short-term technical advantage, but have faded a bit later this week. The next upside price objective for silver bulls is to close prices above solid technical resistance at the February high of $ 19,075 an ounce. The next downside price breakout target for bears is to close prices below solid support at $ 17.00. The first resistance is seen at $ 17.75 and then at $ 18.00. The next support is seen at this week’s low of $ 17,425 and then at $ 17.25. Wyckoff Market Rating: 6.5.
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