Gold sees mild price pullback from Wednesday's good gains

Gold prices are modestly weaker in early U.S. trading Thursday, on a normal downside correction from the solid gains posted Wednesday. Importantly, the gold and silver bulls appear to have stabilized their markets following recent selling pressure. October gold futures were last down $3.20 at $1,748.00 and September Comex silver was last down $0.148 at $23.345 an ounce.

Global stock markets were mixed overnight, with European indexes firmer and at or near record highs and Asian shares a bit weaker. The U.S. stock indexes are pointed to slightly higher openings when the New York day session begins and are at or near their record highs. The summertime doldrums are presently the feature in the marketplace—not surprising for mid-August, when families are taking vacations just before school starts and as most of Europe is on holiday.

The U.S. gets another inflation reading today, as the producer price index for July is due out. The PPI is seen up 0.6% from June after rising by 1.0% in June from May.

The key outside markets today see the U.S. dollar index slightly up after hitting a 4.5-month high Wednesday. Nymex crude oil futures prices are a bit weaker and trading around $69.00 a barrel. The OPEC oil cartel said the new Delta Covid variant will likely dent global crude oil demand growth in 2021 and 2022. The International Energy Agency today also cut world oil demand growth in 2021, by 100,000 barrels per day, to 5.3 million barrels per day. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching 1.351%.

Other U.S. economic data due for release Thursday includes the weekly jobless claims report.

Technically, October gold futures bears have the overall near-term technical advantage amid the recent steep downdraft in prices. 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 this week’s spike low of $1,676.40. First resistance is seen at the overnight high of $1,757.20 and then at this week’s high of $1,763.00. First support is seen at $1,736.90 and then at Wednesday’s low of $1,724.30. Wyckoff's Market Rating: 3.5

The silver bears have the solid overall near-term technical advantage. Prices are in an 11-week-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 Tuesday’s high of $23.675 and then at $24.00. Next support is seen at Wednesday’ low of $23.19 and then at $23.00. Wyckoff's Market Rating: 2.5.
 

By Jim Wyckoff

For Kitco News

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