Today's Gold and Silver News - 10th August

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Gold: The real crystal ball?

Is gold telling us that CPI is about to come in under expectations tomorrow? A weaker CPI would clearly be a politically expedient result. Selling of USD may accelerate on a weaker than expected number as the market reprices future rate hike expectations.

The below 4-hour gold chart shows the metal putting in what is an ascending triangle pattern. The rule is the flatter the top, the better the probability of a breakout to the topside. Perhaps gold breaks out of the triangle prior to tomorrow’s 8.30 print. The quick dip buying action seen on Friday showed the bull’s resolve.

Image Source: Kitco News

The yellow highlighted areas are congestion zones where bulls are currently facing resistance and should expect to face resistance if the probability of an upside break does play out. Read More

Gold is coming up to a key technical zone

Looking at the gold daily price chart below the yellow metal has been moving higher in recent sessions back towards the $1800/oz psychological area. Close to this zone, there are some confluence resistance areas to look out for and the price could get stuck in familiar territory.

The chart below shows a blue highlighted zone that has been very sticky in the past. Not only this it was used as very strong support in the middle of May. In addition to this, there is a trendline where the first two lower high peaks are connected when the downtrend began. When trendlines break it can be a significant sign that a trend is about to reverse. Above this area, the next major resistance is at the green zone near $1875/oz. 

On the downside, the main support is at the red shaded area at just under $1700/oz. At the moment that zone doesn't look like it could get threatened any time soon but if the resistance holds we could see a move back down there but it is unlikely. If we do see a break of the trendline quite often the price comes back to test the area before moving higher in the prevailing direction. For now, let's see how the U.S. traders react to the positive price action at the open. Read More

Image Source: Kitco News

Risk of significant reversal in gold price rally as inflation report looms, says TD Securities

The strong employment report proved that the U.S. economy is still expanding despite two consecutive negative quarterly GDP releases. And for gold, this means that the price rally could be at risk, according to TD Securities.

In reaction to the U.S. economy adding 528,000 jobs in July, gold lost 1% on Friday. The July report more than doubled economist expectations of additional 250,000 jobs. On Monday, gold staged a recovery, with December Comex gold futures rising back to $1,793.00, up 0.70% on the day.

Friday's selloff was led by a shift in sentiment that markets were premature to price in a Federal Reserve pivot from the aggressive tightening cycle, said TD Securities head of commodity strategy Bart Melek.

"The 528k increase in payrolls, unemployment drop to just 3.5% and the outsized 5.2% y/y jump in earnings growth all suggest the U.S. economy is expanding, despite the two consecutive negative quarterly GDP prints," Melek said Friday. "This, along with service sector robustness and given the U.S. consumer has larger-than-normal holdings of cash in checking accounts and money market funds, which sit at around three trillion dollars, all suggest that there are plenty of inflationary pressures in the system."

This week, the attention will be on the July inflation report out of the U.S., with economists projecting the annual inflation pace to come in at 8.7% after rising to 9.1% in June. Read More

Gold pops to 4-week high on friendlier charts, weaker USDX

Gold prices are moderately up and hit a four-week high in midday U.S. trading Tuesday. The yellow metal was boosted by technical buying, a weaker U.S. dollar index and even by some light safe-haven demand. October gold futures were last up $9.20 at $1,803.60. September Comex silver futures were last down $0.119 at $20.495 an ounce.

Traders are awaiting two key U.S. inflation reports that are on deck. Wednesday comes the consumer price index report for July, which is seen coming in up 8.7%, year-on-year, after a rise of 9.1% in the June report. Thursday comes the producer price index report for July, seen up 0.2% from June and compares to the June report’s rise of 1.1% from May.

Technically, October gold futures prices hit a four-week high today. The gold futures bears still have the slight overall near-term technical advantage. However, a fledgling price uptrend is in place on the daily bar chart to suggest more upside in the near term. Bulls’ next upside price objective is to produce a close above solid resistance at $1,850.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,750.00. First resistance is seen at today’s high of $1,806.00 and then at 1,825.00. First support is seen at today’s low of $1,788.50 and then at this week’s low of $1,776.20. Wyckoff's Market Rating: 4.5.

Image Source: Kitco News

September silver futures bears have the overall near-term technical advantage. However, prices are in a fledgling uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $22.00. The next downside price objective for the bears is closing prices below solid support at $19.00. First resistance is seen at this week’s high of $20.745 and then at $21.00. Next support is seen at $20.25 and then at $20.00. Wyckoff's Market Rating: 4.0. Read More

Image Source: Kitco News

The Inflation Reduction Act will do nothing; The U.S. economy’s ‘inevitable collapse’ will come due to excessive debt – Ron Paul

For former Congressman Ron Paul, it is too little, too late.

“The only way [federal] debt is going to be liquidated, which is absolutely necessary over a period of time to get the market working again… is by inflation,” he said.

Paul, who represented Texas until 2013, said that he knew only four legislators, during his entire political tenure, who understood how markets work.

“The collapse will come… The debt has to be liquidated,” he said. “The preference I would have is [for the government] to quit spending. Balance the budget. Don’t accumulate any more debt. But politically, having spent a little bit of time in Washington, it’s not going to happen.”

Paul spoke with David Lin, Anchor and Producer at Kitco News. Read More

Tomorrow's CPI report is anticipated to reveal a fractional decline in inflation

Market participants, analysts, and economists are eagerly awaiting tomorrow’s U.S. consumer price index report for July, which will be released at 8:30 AM EDT. It is widely anticipated that tomorrow’s report will show a fractional decline in “headline” inflation (which includes energy and food). The slight downtick is expected to show that inflation vis-à-vis the CPI will come in at 8.7% to 8.8%, a decrease of 0.3% from June’s CPI showing that inflation was at a 41-year high of 9.1%.

That being said, even if the report comes in around the economists’ forecast it will not greatly affect the actions of the Federal Reserve at the next FOMC meeting which will run from September 20 - 21. According to the CME’s FedWatch tool, there is a 69.5% probability that the Federal Reserve will initiate its third consecutive 75 basis point rate hike and a 30.5% probability that the Fed will raise rates by 50-point basis points. Read More

Gold and silver trade lower ahead of the European open

Gold (-0.31%) and silver (-0.49%) have moved lower heading into the European open. In the rest of the commodities complex, copper (-0.40%) and WTI (1.06%) have both fallen as there is weakness across the board. 

Risk sentiment was poor in the Asia Pac area as the Nikkei 225 (-0.65%), Shanghai Composite (-0.56%) and ASX (-0.53%) all struggled overnight. Futures in Europe are pointing towards a negative open. 

In FX markets the biggest mover overnight was USD/CHF (-0.10%) in a very quiet session. BTC/USD is trading at $22,953.

News from overnight. Read More

Disclaimer: These articles are provided for informational purposes only. They are not offered or intended to be used as legal, tax, investment, financial, or any other advice.