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Price advances for gold, silver as USDX declines

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(Kitco News) - Gold and silver prices are higher in early U.S. trading Friday, lifted by a sharp overnight drop in the U.S. dollar index. The USDX has come well off its overnight low and that has dropped the two precious metals from their overnight highs. More short covering in the futures markets heading into the weekend is featured in both metals. October gold was last up $11.90 at $1,722.50 and December silver was up $0.138 at $18.58.

Global stock markets were mostly firmer overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins. The markets have brushed aside, for now, the hawkish tone of the U.S. Federal Reserve that was reinforced by comments from Chairman Powell on Thursday. Also, the European Central Bank on Thursday raise its main interest rate by 0.75%--the largest in over 20 years. It’s very likely traders and investors have already factored into markets’ prices the tighter monetary policies of most of the major central banks of the world.

Somewhat overshadowing the marketplace and crowding out other business/financial news is the death of Queen Elizabeth on Thursday.

Gold bears remain in control as short squeeze runs out of momentum

The key outside markets today see Nymex crude oil prices higher and trading around $85.00 a barrel. The U.S. dollar index is lower on a corrective pullback after hitting a 20-year high Wednesday. The yield on the 10-year U.S. Treasury note is fetching 3.260%.  

U.S. economic data due for release Friday is light and includes monthly wholesale trade.

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 $1,730.50 and then at $1,740.00. First support is seen at the overnight low of $1,710.00 and then at $1,700.00. Wyckoff's Market Rating: 2.5

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 $20.00. The next downside price objective for the bears is closing prices below solid support at $17.00. First resistance is seen at the overnight high of $18.86 and then at $19.00. Next support is seen at Thursday’s low of $18.24 and then at $18.00. Wyckoff's Market Rating: 2.5.

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.