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Gold prices near steady as pandemic infections continue to surge

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(Kitco News) - Gold prices are trading near unchanged in early U.S. trading Monday and have lost modest overnight gains. There is still some safe-haven demand for the yellow metal amid heightened concerns about the Covid-19 pandemic and a second wave hitting global economies. August gold futures were last down $0.60 an ounce at $1,780.00. September Comex silver prices were last down $0.178 at $17.995 an ounce.

Global stock markets were mixed and choppy in overnight trading. U.S. stock indexes are pointed toward mixed openings when the New York day session begins. Trader and investor risk appetite continues to pull back as the Covid-19 pandemic continues to spread in many countries. News headlines to start the trading week highlight the pandemic’s worldwide death toll has passed 500,000 and the total number of reported cases is above 10 million. In a grim markets assessment, one research analyst this morning said in an email dispatch: “Hopes of a robust economic recovery following the pandemic are now shattered. The risks of re-imposing lockdowns are high and monetary policy stimulus which explains most of the recovery in asset prices from the March lows will become less effective going forward if it doesn’t translate into a rebound in economic activity and better prospects for corporate earnings. Risk asset valuations remain elevated and the next few weeks ahead will tell us whether they will continue to hold or get bumped.”

It's a holiday-shortened U.S. trading, as markets are closed Friday for the Independence Day holiday. The U.S. economic highlight of the week will be Thursday morning’s monthly jobs report from the Labor Department. In June, the key non-farm payrolls number is expected to be up 3.15 million, with the unemployment rate forecast at 12.4%.

The important outside markets today see Nymex crude oil prices slightly weaker and trading around $38.50 a barrel. The U.S. dollar index is lower early today. The yield on the benchmark U.S. Treasury 10-year note is currently around the 0.7% level.

U.S. economic data due for release Monday includes pending home sales and the Texas manufacturing outlook survey.

Live 24 hours gold chart [Kitco Inc.]

Technically, the gold bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close in August futures above solid resistance at $1,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at last week’s low of $1,754.00. First resistance is seen at the overnight high of $1,790.40 and then at the June high of $1,796.10. First support is seen at the overnight low of $1,778.00 and then at $1,764.10. Wyckoff's Market Rating: 8.5

Live 24 hours silver chart [ Kitco Inc. ]

September silver futures bulls have the firm overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at the February high of $19.125 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the June low of $17.175. First resistance is seen at last week’s high of $18.425 and then at $18.585. Next support is seen at $18.00 and then at last week’s low of $17.595. Wyckoff's Market Rating: 7.0.

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.