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Mild price weakness in Gold after as-expected U.S. inflation data

Kitco News

(Kitco News) - Gold and silver prices are weaker in early U.S. trading Thursday, on modest downside corrections following this week’s gains. Gold and silver bulls still have some momentum on their side. December gold was last down $1.40 at $1,971.60 and December silver was down $0.154 at $24.95.

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The U.S. data point of the day Thursday is the personal income and outlays report for August, including the closely watched PCE inflation readings. The core PCE reading for August came in at up 4.2%, year-on-year, which was right in line with market expectations and compares to up 4.1% in the July report. Markets showed no significant reactions to the as-expected report.

The busy U.S. data week is highlighted by Friday’s employment situation report for August from the Labor Department. The key non-farm payrolls number is expected to come in at up 170,000, compared to a rise of 187,000 in the July report. Downbeat U.S. data released so far this week has many thinking Friday’s jobs report will be in line with market expectations, or a bit weaker.

Asian stock markets were mixed and European stock markets mostly up in overnight trading. U.S. stock indexes are pointed to firmer openings when the New York day session begins. The U.S. stock index bulls are having a good week and hit three-week highs overnight.

In overnight news, China’s official manufacturing purchasing managers index (PMI) for August had a reading of 49.7, up from July’s 49.2 figure. The services PMI for August was 50.5 compared to 51.5 in the July report. A reading below 50.0 suggests contraction in the sector. The manufacturing PMI was below 50.0 for the fifth straight month and the services PMI declined for the sixth straight month.

How gold price gets to $10k: BRICS expansion, gold-backed currency, monetary reset - Willem Middelkoop

The Euro zone August consumer price index came in at up 5.3%, year-on-year, which was unchanged from the July report and right in line with market expectations.

The key outside markets today see the U.S. dollar index higher. Nymex crude oil futures prices are higher and trading around $82.50 a barrel. The benchmark U.S. Treasury 10-year note is presently fetching around 4.1%.

Other U.S. economic data due for release Thursday includes the weekly jobless claims report, the Challenger job-cuts report and the Chicago ISM business survey and the monthly retail chain store sales index.

Live 24 hours gold chart [Kitco Inc.]

Technically, the gold futures bears still have the overall near-term technical advantage but the bulls have gained momentum this week. Bulls’ next upside price objective is to produce a close in December futures above solid resistance at $2,000.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the August low of $1,913.60. First resistance is seen at this week’s high of $1,977.10 and then at $1,985.00. First support is seen at Wednesday’s low of $1,962.80 and then at $1,950.00. Wyckoff's Market Rating: 4.0

Live 24 hours silver chart [ Kitco Inc. ]

The silver bulls have the overall near-term technical advantage and have momentum. A fledgling price uptrend is in place on the daily chart. Silver bulls' next upside price objective is closing December futures prices above solid technical resistance at the July high of $25.82. The next downside price objective for the bears is closing prices below solid support at $23.50. First resistance is seen at the overnight high of $25.06 and then at this week’s high of $25.425. Next support is seen at $24.555 and then at $24.31. Wyckoff's Market Rating: 6.5.

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