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Gold is moderately higher and silver sharply up in midday U.S. trading Monday. The precious metals are supported by a depreciating U.S. dollar on the foreign exchange market. The U.S. dollar index is sharply lower today and hit a two-week low after last week posting a 20-year high. A dip in U.S. Treasury yields to start the trading week is also a positive for the precious metals markets. October gold was last up $14.00 at $1,733.00 and December silver was up $1.088 at $19.865.
U.S. stock indexes higher so far today. Stock and financial markets are almost half-way through the month of September with no major marketplace anxiety. The major U.S. stock indexes have seen short-term price downtrends stall out. History shows September and October can be rocky months for the stock and financial markets.
Traders and investors are awaiting the latest U.S. inflation report on Tuesday. The August consumer price index is seen coming in up 8.0%, year-on-year, compared to the July report showing an 8.5% rise. There are some signs in the economy that inflation in the U.S. is cooling off a bit.
Weak inflation will be key to a sustainable gold rally above $1,750
The other key outside market today sees Nymex crude oil prices higher and trading around $87.75 a barrel. The yield on the 10-year U.S. Treasury note is fetching 3.298%.
Technically,ctober gold futures bears still have the firm overall near-term technical advantage. However, a four-week-old downtrend on the daily bar chart is now in jeopardy. There is also the potential for a big and bullish double-bottom reversal pattern forming on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,769.30. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the July low of $1,686.30. First resistance is seen at $1,740.00 and then at $1,750.00. First support is seen at today’s low of $1,712.70 and then at $1,700.00. Wyckoff's Market Rating: 2.5.
December silver futures prices hit a three-week high today. The silver bears have the overall near-term technical advantage. However, the bulls have momentum on their side to suggest a market bottom is in place. Silver bulls' next upside price objective is closing prices above solid technical resistance at $21.00. The next downside price objective for the bears is closing prices below solid support at $18.50. First resistance is seen at $20.00 and then at $20.50. Next support is seen at $19.50 and then at $19.00. Wyckoff's Market Rating: 3.5.
December N.Y. copper closed up 235 points at 359.10 cents today. Prices closed nearer the session high today on short covering. The copper bears have the overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the August high of 378.35 cents. The next downside price objective for the bears is closing prices below solid technical support at the July low of 315.55 cents. First resistance is seen at last week’s high of 362.85 cents and then at 365.00 cents. First support is seen at today’s low of 353.20 cents and then at 350.00 cents. Wyckoff's Market Rating: 3.5.
By Jim Wyckoff
For Kitco News
