Gold Pares Losses After U.S. GDP Misses To Downside
(Kitco News) - Gold prices are modestly lower in early U.S. trading Friday in the immediate aftermath of a U.S. gross domestic product report that did not meet market expectations. August gold futures were last down $3.20 an ounce at $1,222.40. September Comex silver was last down $0.04 at $15.455 an ounce.
The big U.S. economic data point of the week is this morning’s first estimate of second-quarter gross domestic product (GDP). The number came in at up 4.1%, which was a miss to the downside, but a strong number nonetheless. The figure was expected to come in at up 4.4%. Some analysts were calling for a growth number of 5.0% or just above. However, some weak U.S. economic data released Thursday saw some analysts scaling back their GDP number for today.
In the wake of the GDP report, the gold market pared its losses, while the U.S. dollar index and U.S. stock indexes backed off a bit from modest earlier gains.
World stock markets were mostly firmer overnight, following the U.S. and European Union initial agreement to stop slapping trade tariffs on each other. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins. U.S. stock index futures on Wednesday hit new contract or multi-month highs.
In overnight news, European Union forecasters slightly raised their expectations for EU inflation in the years 2018-2020 to 1.7%. The numbers had been 1.5% to 1.6% annual inflation during those years.
Other U.S. economic data due for release Friday includes the University of Michigan consumer sentiment survey.
Technically, gold bears have the solid overall near-term technical advantage amid a price downtrend on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close in August futures above solid resistance at $1,250.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,200.00. First resistance is seen at this week’s high of $1,235.30 and then at $1,240.00. First support is seen at today’s low of $1,216.70 and then at last week’s low of $1,210.70. Wyckoff's Market Rating: 1.5
September silver futures bears have the solid overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $16.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $15.00. First resistance is seen at this week’s high of $15.70 and then at $15.90. Next support is seen at this week’s low of $15.34 and then at last week’s low of $15.185. Wyckoff's Market Rating: 1.5.