Safe-haven buying featured in gold, silver ahead of U.S. election results
(Kitco News) - Gold and silver futures prices are again moderately higher, with gold near its daily high in midday U.S. trading Tuesday. More safe-haven demand is featured for the metals as the highly anticipated and very uncertain U.S. election day is at hand. A sharply weaker U.S. dollar index today is also working in favor of the precious metals market bulls. December gold futures were last up $17.90 at $1,910.40 and December Comex silver was last up $0.282 at $24.315 an ounce.
Today is the day—arguably the most contentious U.S. presidential election in U.S. history is at hand in a bitterly divided nation. So far this week the stock and financial markets are not showing keen risk aversion. Gold is seeing a bit of safe-haven demand. Contender Joe Biden has a sizeable lead over President Donald Trump in most polls. However, the polls were wrong in the last U.S. presidential election in 2016. Some businesses in some cities are boarding up their windows in case of civil unrest following the elections. There are so many uncertainties regarding the election results and how the American public and even the standing U.S. government reacts in the aftermath of the voting results. It is a bit surprising to this longtime market watcher that the marketplace presently appears so calm and is not exhibiting much risk aversion.
The second big market element is the pandemic. Covid-19 cases continue to rise in the U.S. and Europe, with the U.K. and France locking down many businesses. U.S. Covid-19 cases are hitting daily records, with some health experts saying the U.S. will experience a “dark winter.”
It’s also a week in which the Federal Open Market Committee (FOMC) meets starting Wednesday and on Thursday issues a statement on U.S. monetary policy. Fed Chairman Powell will also hold a press conference Thursday afternoon. No major changes in U.S. monetary policy are expected, but the marketplace will be looking for guidance on future actions from the Fed.
And on Friday the U.S. employment situation report for October from the Labor Department is out. The key non-farm payrolls number is seen up 530,000 and the unemployment rate is seen at 7.7% versus 7.9% seen in September.
The important outside markets today see the U.S. dollar index solidly lower. Bears remain in overall near-term technical control of the greenback. Nymex crude oil prices are higher today and presently trading around $37.80 a barrel. Crude oil is seeing a strong rebound after hitting a five-month low Monday. The yield on the benchmark U.S. 10-year Treasury note is 0.88% today.
Technically, December gold futures bulls have the overall near-term technical advantage and have gained momentum this week. Bulls’ next upside price objective is to produce a close in December futures above solid resistance at the October high of $1,939.40. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the September low of $1,851.00. First resistance is seen at last week’s high of $1,913.80 and then at $1,925.00. First support is seen at today’s low of $1,887.60 and then at this week’s low of $1,873.30. Wyckoff's Market Rating: 6.5
December silver futures bulls have the overall near-term technical advantage and have gained some momentum. Silver bulls' next upside price objective is closing prices above solid technical resistance at the October high of $25.71 an ounce. The next downside price objective for the bears is closing prices below solid support at the September low of $21.81. First resistance is seen at last week’s high of $24.675 and then at $25.00. Next support is seen at today’s low of $23.975 and then at this week’s low of $23.46. Wyckoff's Market Rating: 6.5.
December N.Y. copper closed up 250 points at 310.20 cents today. Prices closed near mid-range today. The copper bulls have the solid overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the October high of 321.80 cents. The next downside price objective for the bears is closing prices below solid technical support at 290.00 cents. First resistance is seen at today’s high of 312.30 cents and then at last week’s high of 314.30 cents. First support is seen at this week’s low of 302.80 cents and then at 300.00 cents. Wyckoff's Market Rating: 7.5.