Gold sees sharp losses amid better risk appetite late this week
(Kitco News) - Gold and silver prices are solidly lower in midday U.S. trading Thursday. There is keener risk appetite in the marketplace—as seen by a big rebound in the U.S. stock market after Monday’s steep losses--and that’s bearish for the safe-haven metals. October gold futures were last down $27.80 at $1,748.90. December Comex silver was last down $0.207 at $22.70 an ounce.
Global stock markets were mostly up in overnight trading. The U.S. stock indexes are also higher at midday. Risk-on attitudes are increasing late this week. The marketplace at present feels the troubled Chinese property giant, Evergrande, will not create a contagion effect in financial markets. Most believe the Chinese government will not let Evergrande fail. The firm had an $83 million interest payment due Thursday and it is not known if the payment was made.
The conclusion of the Federal Reserve’s FOMC meeting Wednesday afternoon saw the U.S. central bank make no monetary policy changes, but it did set the table for future tapering of its bond-buying program, and an increase in its key interest rate in 2022. Fed Chairman Powell at his press conference sounded upbeat on U.S. economic and jobs-growth prospects. Judging by the positive reactions of stock and financial markets, the Fed meeting’s results, while not leaning dovish, were not too hawkish on U.S. monetary policy.
The U.S. government is grappling with extending the U.S. debt ceiling. Treasury Secretary Janet Yellen said the government will run out of money sometime in October. While looming over the marketplace, this situation has played out more than once over recent years, but it could still inject some anxiety into the marketplace, if the government actually nears a shutdown.
The key outside markets today see the U.S. dollar index solidly lower. Nymex crude oil futures prices are higher and trading around $73.50 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching around 1.4%.
Technically, gold bears have the overall near-term technical advantage and gained more power today. A three-week-old price downtrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,700.00. First resistance is seen at $1,765.00 and then at today’s high of $1,774.50. First support is seen at this week’s low of $1,740.50 and then at $1,730.00. Wyckoff's Market Rating: 4.0
The silver bears have the solid overall near-term technical advantage. Prices are in a three-week-old downtrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $24.00 an ounce. The next downside price objective for the bears is closing prices below solid support at $21.00. First resistance is seen at $23.00 and then at this week’s high of $23.15. Next support is seen at $22.455 and then at this week’s low of $22.025. Wyckoff's Market Rating: 2.0.
December N.Y. copper closed down 160 points at 423.60 cents today. Prices closed near mid-range today. The copper bulls and bears are on a level overall near-term technical playing field. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the September high of 447.15 cents. The next downside price objective for the bears is closing prices below solid technical support at the August low of 396.65 cents. First resistance is seen at 430.00 cents and then at 435.00 cents. First support is seen at today’s low of 419.45 cents and then at Wednesday’s low of 410.70 cents. Wyckoff's Market Rating: 5.0.