(Kitco News) - Gold prices are near steady in early U.S. trading Friday and not far below Thursday’s record high. Some mild profit taking is featured following a key U.S. inflation report that contained no big surprises to significantly move markets. Gold and silver prices did modestly up-tick following the inflation data, which was just slightly tamer than expected. December gold was last down $0.50 at $2,694.30 and December silver was up $0.034 at $32.38.
The just-released U.S. data point of the week is this morning’s personal income and outlays report for August and its inflation indexes that are said to be favored by the Federal Reserve. The PCE price index came in at up 2.2%, year-on-year, and was seen coming in at up 2.3% and compares to up 2.5% in the July report. The core PCE (excluding food and energy) came in up 2.7% annually, in line with market expectations and compares to up 2.6% in the July report. The markets did not react strongly to the numbers.
Asian and European stock indexes were mostly firmer overnight. U.S. stock indexes are pointed to slightly higher openings when the New York day session begins. The S&P 500 Thursday hit a record high, while the Nasdaq stock index scored a nine-week high.
China’s aggressive economic stimulus moves this week remain near the front burner of the marketplace. A Wall Street Journal story today said, “China’s leaders have been drip-feeding support into their ailing economy for three years. This week, they jacked up the dose.” More stimulus from Chinese government officials is likely. China’s stock markets have rallied on this week’s major economic moves.
The Israel-Hezbollah military conflict has escalated recently, with the Israel telling its military to prepare for a possible ground invasion of Lebanon, after recent heavy air bombardments. This situation is keeping safe-haven bids in gold and silver and will likely get worse before it gets better.
The key outside markets today see the U.S. dollar index slightly lower. Nymex crude oil prices are near steady and trading around $67.75 a barrel. The benchmark 10-year U.S. Treasury note yield is on the decline and is presently fetching 3.77%.
Other U.S. economic data due for release Friday includes the advance economic indicators report, and the University of Michigan consumer sentiment survey.
Technically, December gold bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $2,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,600.00. First resistance is seen at the contract high of $2,708.70 and then at $2,725.00. First support is seen at the overnight low of $2,680.60 and then at Wednesday’s low of $2,673.40. Wyckoff's Market Rating: 9.5.
December silver futures bulls have the solid overall near-term technical advantage. Prices are in a six-week-old uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the May high of $33.50. The next downside price objective for the bears is closing prices below solid support at $30.00. First resistance is seen at this week’s high of $33.02 and then at $33.50. Next support is seen at the overnight low of $31.865 and then at $31.50. Wyckoff's Market Rating: 8.0.
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