Gold Traders Closely Watching Secondary Currency Markets Today
(Kitco News) - Gold and silver prices are slightly lower in early U.S. trading Thursday. However, the safe-haven metals bulls are closely watching developments today in the secondary currency markets. December gold futures were last down $1.20 an ounce at $1,210.40. December Comex silver was last down $0.12 at $14.69 an ounce.
A feature in the marketplace today is weakness in secondary market currencies versus the U.S. dollar. The Argentine peso hit a record low against the greenback and the Turkish lira is also under pressure today. The Brazilian real and Indian rupee are also solidly lower against the dollar. As the calendar turns to September next week, look for focus on secondary currencies and their countries’ problematic debt loads to become in keener focus among traders and investors. Any escalation in this situation would significantly spook the marketplace and likely prompt safe-haven demand for gold and silver.
World stock markets were mixed to lower overnight. U.S. stock indexes are pointed toward weaker openings, on mild profit taking after hitting record highs on Wednesday.
Reports say the U.S. and Canada are close to agreeing on a trade deal, after the U.S and Mexico reached a deal on Monday. Optimism the U.S. will reach more trade agreements with its major trading partners has in part lifted world stock markets this week.
The key outside markets today find the U.S. dollar index slightly up on a corrective bounce after seeing losses this week. Meantime, Nymex crude oil prices are slightly up, hit a six-week high overnight and trading just below $70.00 a barrel.
U.S. economic data due for release Thursday is light and includes the weekly jobless claims report and personal income and outlays.
Technically, gold bears still have the overall near-term technical advantage but a price downtrend on the daily bar chart has been negated to suggest a market bottom is in place. Gold bulls' next upside near-term price breakout objective is to produce a close in December futures above solid resistance at $1,226.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the August low of $1,167.10. First resistance is seen at this week’s high of $1,220.70 and then at $1,225.00. First support is seen at this week’s low of $1,205.80 and then at $1,200.00. Wyckoff's Market Rating: 3.0
December silver futures bears have the overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $15.50 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $14.00. First resistance is seen at $15.00 and then at this week’s high of $15.07. Next support is seen at $14.555 and then at the August low of $14.405. Wyckoff's Market Rating: 2.5.