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Gold Rallies Above $1,300.00 After Slightly Downbeat U.S. Data

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(Kitco News) - Gold prices are higher, hit a more-than two-week high and have pushed above the important $1,300.00 level in early U.S. trading Friday. The yellow metal was lifted in the aftermath of just-released U.S. economic data that saw slight misses to the downside. December Comex gold was last up $7.60 an ounce at $1,304.10. December Comex silver was last up $0.109 at $17.37 an ounce.

The September U.S. consumer price index came in at up 0.5% from August. A reading of up 0.6% was expected. The CPI minus food and energy (called the core rate) came in at up 0.1% in September, when a reading of up 0.2% was expected.

Meantime, U.S. retail sales in September came in at up 1.6%, compared to a number of up 1.7% that was forecast. August retail sales were also revised downward, to minus 0.1%.

Gold prices were trading slightly lower just before these reports and then rallied in the immediate aftermath.

World stock markets were mostly firmer overnight. Many world stock indexes are at or near record or multi-year highs. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. 

Stock market traders and investors are focusing on upbeat world economic growth prospects as a bullish tonic. However, they are paying little attention to geopolitics. If the stock market community does begin to pay more attention to geopolitics (which will likely be the case) then look for increased money flows out of equities and into hard assets like gold and other raw commodities.

New on the geopolitical front Friday morning are reports that President Trump is ready to decertify the U.S-Iran nuclear agreement from the Obama administration. Also, reports said Brexit talks between the U.K. and the European Union are not going well.

In overnight news, China’s exports were up 8.1% in September, year-on-year, while its imports were up 18.7%. The exports figure was lower than expected and the imports number was higher than expected.

The U.S. dollar index is firmer in early U.S. trading Friday, which is a bit negative for the precious metals markets. However, the greenback bears have had the better week. The other key outside market sees Nymex crude oil futures prices solid higher and trading above $51.00 a barrel. The oil bulls this week regained the near-term chart advantage.

It will be a busy day for U.S. economic data releases Friday, including the consumer price index, retail sales, real earnings, manufacturing and trade inventories, and the University of Michigan consumer sentiment survey. The consumer price index for September is the headline number of the day. The CPI is expected to come in at up 0.6% from August.

Live 24 hours gold chart [Kitco Inc.]

Technically, December gold futures bulls have regained the slight overall near-term technical advantage. Bulls’ next upside technical objective is pushing and closing prices above chart resistance at $1,320.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at last week’s low of $1,262.80. First resistance is seen at 1,307.00 and then at $1,310.00. First support is seen at the overnight low of 1,292.90 and then at Wednesday’s low of $1,286.80. Wyckoff’s Market Rating: 5.5

Live 24 hours silver chart [ Kitco Inc. ]

December silver bulls have the slight overall near-term technical advantage. Prices pushed to a three-week high today. The next upside price breakout objective is closing futures prices above solid technical resistance at $18.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at last week’s low of $16.345. First resistance is seen at $17.445 and then at $17.50. Next support is seen at the overnight low of $17.20 and then at $17.00. Wyckoff's Market Rating: 5.5.

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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