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Gold, silver prices down on news U.S-China trade talks restarting

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(Kitco News) - Gold and silver prices are moderately lower in early U.S. trading Thursday, on some more profit-taking from the shorter-term futures traders and as investor risk appetite up-ticked overnight on news U.S.-China trade talks are set to resume in October. On Wednesday, gold futures hit a 6.5-year high and silver futures a three-year high. December gold futures were last down $11.10 an ounce at 1,549.30. December Comex silver prices were last down $0.172 at $19.375 an ounce.

The just-released ADP national employment report for August came in at up 195,000 jobs, which was significantly higher than the forecast of up 140,000. There was little markets impact from the report.

With all the activity on a U.S.-holiday-shortened trading week, the marketplace almost forgot about the August U.S. employment situation report from the Labor Department that is out Friday morning. The key “non-farm” payrolls component of the report is expected to show a gain of 150,000 in August.

Asian and European stock markets mostly higher overnight. U.S. stock indexes are pointed toward solidly higher openings when the New York day session begins. Traders and investors around the globe got another attitude-booster Thursday when China’s commerce ministry said trade talks with the U.S. will restart in Washington, D.C. in October. U.S. trade officials confirmed high-level talks will take place at that time. There were notions earlier this week the China-U.S. trade war had escalated recently. As has been the case for months, this situation vacillates from one day to the next, depending on the latest rhetoric coming from the world’s two largest economies. Most market watchers are not optimistic a U.S.-China trade deal will be reached this year.

While markets on Wednesday were relieved Hong Kong’s leader withdrew from consideration a proposed law that would allow the extradition of Hong Kong citizens to mainland China for criminal trials, reports Thursday said more protests are planned in the coming days. Right now it appears doubtful the reversal of Hong Kong’s leader on the extradition matter will be enough to quell the civil unrest.

Meantime, the Brexit turmoil continues as the October deadline for a U.K. deal with the European Union approaches. Prime Minister Boris Johnson wants out with no extension of time to reach a “soft” Brexit. However, votes this week from Parliament appear to have defeated his “hard” Brexit stance—at least for now. This news has boosted the British pound off its 34-year low against the U.S. dollar, reached earlier this week.

The key “outside markets” today see Nymex crude oil prices near steady and trading around $56.00 a barrel. The U.S. dollar index is lower on a normal downside correction after hitting a 27-month high Monday.

A very heavy slate of U.S. economic data due for release Thursday includes the weekly jobless claims report, the Challenger job-cuts report, the ADP national employment report, revised productivity and costs, the ISM non-manufacturing report on business, the U.S. services and the global services PMIs, monthly chain store sales, the weekly DOE liquid energy stocks report, and manufacturers’ shipments and inventories.

Live 24 hours gold chart [Kitco Inc.]

Technically, the gold bulls have the solid overall near-term technical advantage. A three-month-old uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close in October futures above solid resistance at $1,600.00. Bears' next near-term downside price breakout objective is pushing December futures prices below solid technical support at $1,500.00. First resistance is seen at the overnight high of $1,561.90 and then at this week’s high of 1,566.20. First support is seen at Wednesday’s low of $1,542.60 and then at $1,535.00. Wyckoff's Market Rating: 8.0

Live 24 hours silver chart [ Kitco Inc. ]

December silver futures bulls have the strong overall near-term technical advantage. Prices are in an accelerating three-month-old uptrend on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $20.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at this week’s low of $17.64. First resistance is seen at this week’s high of $19.75 and then at $20.00. Next support is seen at the overnight low of $19.175 and then at $19.00. Wyckoff's Market Rating: 8.5.

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.