(Kitco News) - Gold prices are trading not far from unchanged in midday action Thursday. The yellow metal lost its overnight gains following a stronger-than-expected U.S. economic report. Silver prices are sharply up and hit another 14-year high. Some keener risk aversion in the general marketplace late this week is prompting some safe-haven demand for the precious metals. December gold was last down $2.60 at $3,765.50. December silver prices were up $0.858 at $45.05.
This morning’s revised second-quarter U.S. GDP report showed a better-than-expected rise of 3.8%, year-on-year, which was above the marketplace expectation for a 3.5% rise. The PCE inflation readings in the GDP report were also slightly higher than expected. The GDP report falls into the camp of the U.S. monetary policy hawks, and was a bit bearish for the precious metals.
Risk aversion is a bit elevated late this week amid worries about a U.S. government shutdown and the recent escalation in the Russia-Ukraine war. The White House budget office is telling U.S. federal agencies to prepare plans for mass firings during a possible U.S. government shutdown next week. Agencies have been directed to identify programs where discretionary funding is set to lapse and draft plans to permanently eliminate jobs in areas not aligned with the Trump administration's priorities. “The move is seen as an escalation beyond normal shutdown protocols, under which nonessential government workers are typically furloughed and eventually brought back with back pay,” said a Bloomberg report. Senate Minority Leader Chuck Schumer said in a statement the move was an “attempt at intimidation,” adding, “these unnecessary firings will either be overturned in court or the administration will end up hiring the workers back.” The termination memo was first reported by Politico.
The key outside markets today see the U.S. dollar index solidly higher after the upbeat GDP report, while crude oil prices are slightly near steady and trading around $65.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently around 4.2%.
Technically, December gold futures bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $3,900.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $3,650.00. First resistance is seen at $3,800.00 and then at this week’s high of $3,824.60. First support is seen at Wednesday’s low of $3,749.70 and then at this week’s low of $3,718.10. Wyckoff's Market Rating: 8.5.
December silver futures bulls have the strong overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at $47.50. The next downside price objective for the bears is closing prices below solid support at $41.50. First resistance is seen at the overnight high of $45.39 and then at $46.00. Next support is seen at the overnight low of $44.06 and then at this week’s low of $43.37. Wyckoff's Market Rating: 9.0.
(Hey! My “Markets Front Burner” weekly email report is my best writing and analysis, I think, because I get to look ahead at the marketplace and do some market price forecasting. Plus, Gold prices are sharply up in early U.S. trading Monday and hit another record high. Silver prices are also up and notched another 14-year high. The powerful but mature bull market runs in gold and silver are accelerating. That’s one early clue that from a time perspective, major market tops could come sooner rather than later. However, from a price perspective, there still could be much more room on the upside for gold and silver prices during this acceleration phase of the mature bull markets, before they peter out for a while. December gold was last up $40.80 at $3,815.90. December silver prices were up $0.361 at $44.575.
I’ll throw in an educational feature to move you up the ladder of trading/investing success. And it’s free! Sign up here; it’s real easy. https://www.kitco.com/services
