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Gold price slightly up on tepid short covering

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(Kitco News) - Gold and silver prices a bit firmer in early U.S. trading Wednesday, on some mild short covering in the futures markets following recent losses. A strong U.S. dollar and rising U.S. Treasury yields continue to squelch buying interest in the metals markets. October gold was last up $1.60 at $1,705.00 and December silver was up $0.152 at $18.06.

Global stock markets were mostly weaker overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. The U.S. stock indexes are trending down on the daily charts. Risk aversion remains elevated in the general marketplace, but that has not helped the precious metals market bulls recently. China reported overnight that its imports and exports fell more than the trade expected in August as the world's second-largest economy continues to stall amid Covid lockdowns, a wobbly property market and a weaker yuan. "The headwinds facing the Chinese economy are becoming increasingly fierce and recent efforts to shore it up have appeared inadequate," said an email dispatch from analyst Craig Erlam with OANDA.

In other overnight news, the revised Euro zone second-quarter GDP rose 0.8% from the second quarter and compares to the initial estimate of up 0.6%. On an annual basis, second-quarter Euro zone GDP showed a growth rate of 4.1%.

The Bank of Canada monetary policy meeting conclusion is today. The European Central Bank meets Thursday and many expect the ECB to raise its main interest rate by 75 basis points.


Brace for a possible U.S. debt crisis if inflation stays elevated, democracy itself is at risk - Michael Gayed

The key outside markets today see Nymex crude oil prices lower and trading around $86.25 a barrel. The U.S. dollar index is higher and touched another 20-year high in early U.S. trading. The yield on the 10-year U.S. Treasury note is fetching 3.307%.  

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the international trade report, the Johnson Redbook weekly retail sales report, and the Federal Reserve's beige book.

Live 24 hours gold chart [Kitco Inc.]

Technically, the October gold futures bears have the solid overall near-term technical advantage. Prices are trending down on the daily bar chart. Bulls' next upside price objective is to produce a close above solid resistance at $1,769.30. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the July low of $1,686.30. First resistance is seen at the overnight high of $1,708.30 and then at this week's high of $1,727.00. First support is seen at the overnight low of $1,692.50 and then at $1,686.30. Wyckoff's Market Rating: 2.0

Live 24 hours silver chart [ Kitco Inc. ]

September silver futures bears have the solid overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at $19.385. The next downside price objective for the bears is closing prices below solid support at $17.00. First resistance is seen at this week's high of $18.465 and then at $18.80. Next support is seen at the overnight low of $17.74 and then at $17.40. Wyckoff's Market Rating: 2.0.

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.