Gold, Silver Stagnant Amid Economic Data Wait
Before the release of some major U.S. economic data on Friday, gold and silver prices slightly declined in the early U.S. session on Thursday. December gold fell by $1.30 to $2,668.40, and December silver dropped by $0.145 to $31.775.
On Friday morning, the Department of Labor will release the September U.S. Employment Situation report, which can be considered the most important data point for the United States this month. The key non-farm payrolls are expected to increase by 150,000 people, compared to the 142,000 increase reported in August. A series of U.S. data were also released on Thursday.
Asian and European stock markets experienced mixed gains and losses overnight. Chinese stock markets are closed this week due to holidays. At the opening of New York, U.S. stock indices once again showed a lower opening, as the overall market's risk-aversion sentiment intensified. Israel continues to launch offensives in Lebanon and vows to retaliate for missile strikes on Iran this week. Most people believe the situation will escalate further.
A report in Barron's today stated, "Gold outperforming the stock market is rare, but it has done well this year." The report added that short-term traders are part of the reason, "Hedge funds have flooded in—overall, they are more bullish than at any time since at least the mid-1980s." Safe-haven demand, generally lower global interest rates, central bank purchases, and bullish technical charts are the main factors that have driven gold prices higher in the past few months.
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Today, the main external markets saw the U.S. Dollar Index rise. Crude oil prices on the New York Mercantile Exchange were higher, trading at around $71.75 per barrel. The outbreak of the situation in the Middle East has driven up oil prices. However, the gains were limited due to reports that OPEC+ might cancel some production cuts. The headline in Dow Jones News today is: "Middle East escalation could push oil prices to $100, but the surge may be short-lived." The benchmark 10-year U.S. Treasury yield is declining, currently at 3.802%.
U.S. economic data released on Thursday included the weekly unemployment claims report, Challenger job cuts report, U.S. Services PMI, manufacturers' shipments and inventories, ISM Business Services report, and Global Services PMI.
Technical Analysis for Gold and Silver
Technically, December gold bulls have a strong overall short-term technical advantage. The next upside price objective for the bulls is to close above solid resistance at $2,800.00. The next near-term downside price objective for the bears is to push futures prices below solid technical support at $2,600.00. First resistance is at the overnight high of $2,683.40, then the week's high of $2,694.70. First support is at the overnight low of $2,660.80, then the week's low of $2,646.20.
December silver futures bulls have a solid overall near-term technical advantage. On the daily bar chart, prices are in a seven-week uptrend. The next upside price objective for bullish silver is to close above solid technical resistance at the May high of $33.50. The next downside price objective for the bears is to close below solid support at $30.00. First resistance is at the overnight high of $32.17, then at $32.50. The next support is expected to be at this week's low of $31.155, then $31.00.
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