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June 19, 2024
PI Global Investments
Precious Metals

Gold price moderately up as USDX weakens, oil rise


(Kitco News) – Gold prices are firmer and silver near steady in early U.S. trading Thursday. The metals are seeing some “outside market” support as this week’s rally in the U.S. dollar index has stalled out, while crude oil prices are higher. However, gains in the precious metals are being limited by an up-tick in U.S. Treasury yields today. February gold was last up $7.90 at $2,050.40. March silver was last up $0.013 at $23.17.

The just-released ADP jobs report for December showed a larger-than-expected rise of 164,000, versus expectations for a gain of 130,000. Markets showed little reaction to the news. Traders are looking ahead to Friday’s U.S. employment situation report for December. The key non-farm jobs number in the report is expected to come in up 170,000 and compares to a rise of 199,000 seen in the November report.

Asian and European stock markets were mixed overnight. U.S. stock index futures are set to open mixed when the New York day session begins, following two sessions of solid losses. Risk appetite in the marketplace is not robust this week, amid heightened tensions in the Middle East.

Wednesday afternoon’s FOMC minutes offered the marketplace nothing substantially new on the trajectory of Fed monetary policy. A Wall Street Journal headline today reads: “Fed minutes offer no timetable on cuts.”

In overnight news, China got some upbeat economic news as its Caixin manufacturing purchasing managers index (PMI) for December came in at 50.8 versus 50.7 in November and 50.3 expected. The Caixin Services PMI was 52.9 versus 51.5 in November and 51.6 forecast. China’s Caixin Composite PMI was 52.6 compared to 51.6 in November.

Meantime, the Euro zone reported its December services PMI at 48.8 versus 48.7 in the November report. A reading below 50.0 suggests contraction in the sector and above 50.0 suggests growth.

The key outside markets today see the U.S. dollar index weaker on a corrective pullback following two days of solid gains. Nymex crude oil prices are higher and trading around $73.50 a barrel. Prices are still in a downtrend on the daily bar chart. Meantime, the yield on the benchmark U.S. Treasury 10-year note is presently fetching 3.959%.

U.S. economic data due out Thursday includes the weekly jobless claims report, the ADP national employment report, the Challenger job-cuts report, the U.S. services PMI, the global services PMI, the monthly retail store sales index, and the weekly DOE liquid energy stocks report.

Technically, the gold futures bulls have the firm overall near-term technical advantage. Prices are in a three-month-old uptrend on the daily

bar chart. Bulls’ next upside price objective is to produce a close in March futures above solid resistance at $2,100.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $2,000.00. First resistance is seen at the overnight high of $2,058.10 and then at Wednesday’s high of $2,074.30. First support is seen at the overnight low of $2,047.00 and then at this week’s low of $2,038.30. Wyckoff’s Market Rating: 7.0.

The silver bears have gained the overall near-term technical advantage. A choppy, three-month-old uptrend on the daily bar chart has been negated. Silver bulls’ next upside price objective is closing March futures prices above solid technical resistance at $25.00. The next downside price objective for the bears is closing prices below solid support at the November low of $22.26. First resistance is seen at $23.50 and then at $24.00. Next support is seen at $23.00 and then at the December low of $22.785. Wyckoff’s Market Rating: 4.0.

Try out my “Markets Front Burner” email report. My next one is due out today and is going to be entitled, “When China sneezes…” Front Burner is my best writing and analysis, I think, because I get to look ahead at the marketplace and do some market price forecasting. And it’s free! Sign up to my new, free weekly Markets Front Burner newsletter, at https://www.kitco.com/services/markets-front-burner.html

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.



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