Gold price sharply down after surprisingly strong U.S. retail sales
(Kitco News) - Gold prices are sharply lower in early U.S. trading Friday and extended early losses following a very upbeat U.S. retail sales report that falls squarely into the camp of the U.S. monetary policy hawks, who want to see U.S. monetary policy tightened sooner rather than later. December gold futures were last down $23.20 at $1,774.70. December Comex silver was last down $0.272 at $23.21 an ounce.
The key U.S. data point Friday is the monthly retail sales report for September, which came in at up 0.7% versus the consensus forecast of down 0.2% from August. The August report was also revised up, to a 0.9% gain from the original figure of up 0.7%.
Global stock markets were mostly higher in overnight trading. The U.S. stock indexes are pointed to higher openings when the New York day session begins. The stock index bulls have gained strength late this week, amid corporate earnings reports that have been generally upbeat.
Traders and investors have been watching developments on raw commodity/supply chain front. Winter is approaching in the Northern Hemisphere and some countries are worried about securing adequate energy supplies. The U.S. government has implemented 24-hour-a-day work shifts at major West Coast U.S. ports. And raw material prices are rising rapidly, with copper prices on the London Metal Exchange rising over 7% just this week. All of the above are likely to add to inflationary price pressures that could become problematic down the road. Such a scenario would be bullish for the metals markets.
The U.S. Securities and Exchange Commission appears ready to allow the first U.S. Bitcoin futures exchange-traded fund to begin trading. That helped push Bitcoin to within striking distance of $60,000 Friday.
The key outside markets today see the U.S. dollar index higher. Nymex crude oil futures are higher, hit a seven-year high and trading around $82.00 a barrel. Meantime, the 10-year U.S. Treasury note yield is presently fetching around 1.547%.
Other U.S. economic data due for release Friday includes the Empire State manufacturing survey, import and export prices, manufacturing and trade inventories and the University of Michigan consumer sentiment survey.
Technically, December gold futures bulls have the slight overall near-term technical advantage as prices are trending higher on the daily chart. Bulls’ next upside price objective is to produce a close above solid resistance at the September high of $1,836.90. Bears' next near-term downside price objective is pushing futures prices below solid technical support at this week’s low of $1,749.90. First resistance is seen at the overnight high of $1,797.70 and then at this week’s high of $1,801.90. First support is seen at today’s low of $1,770.30 and then at $1,757.90. Wyckoff's Market Rating: 5.5
The silver bears have the overall near-term technical advantage. However, bulls are working on a fledgling price uptrend. Silver bulls' next upside price objective is closing December futures 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 $22.00. First resistance is seen at the overnight high of $23.645 and then at $24.00. Next support is seen at Thursday’s low of $22.925 and then at $22.50. Wyckoff's Market Rating: 3.5.