Routine corrective price pullbacks for gold, silver

(Kitco News) – Gold and silver prices are modestly down in early U.S. trading Thursday, on normal downside corrections following recent solid gains. Profit-taking from the shorter-term futures traders is featured. Still-keener risk aversion in the general marketplace as the Middle East crisis continues to play out will very likely keep a floor under the two safe-haven metals for at least the near term. December gold was last down $6.00 at $1,962.30 and December silver was down $0.079 at $23.01.

The U.S. marketplace highlight of the day Thursday is Federal Reserve Chairman Jerome Powell’s speech to the Economic Club of New York in the afternoon.

Rising bond yields and high tensions in the Middle East are also squelching the equities market bulls late this week. Reports said Hamas is firing more missiles into Israel. This comes after an explosion at a Gaza hospital killed over 500 people earlier this week. U.S. and Israeli intelligence say the explosion was caused by Palestinian militants.

Asian and European stocks were mostly lower overnight. U.S. stock indexes are pointed to mixed openings when the New York day session begins. Downbeat quarterly earnings from EV maker Tesla has dampened Wall Street spirits Thursday morning.

In overnight news, the big China property developer Country Garden has missed a $15.4 million debt payment on a dollar bond. The Wall Street Journal said this caps “a remarkable fall from grace for a company that was once considered among the safest developers in the country.”

The key outside markets today see the U.S. dollar index near steady. Nymex crude oil prices are lower and trading around $87.00 a barrel. The yield on the benchmark U.S. Treasury 10-year note yield is closing in on 5.0% and is presently fetching 4.96%.

U.S. economic data due for release Thursday includes the weekly jobless claims report, the Philadelphia Fed business survey, existing home sales, and leading economic indicators.

Technically, the gold futures bulls and bears are now on a level overall near-term technical playing field. However, bulls have momentum and recent price action suggests a market bottom is in place. A four-month-old downtrend on the daily bar chart has been negated and prices are now starting to trend up. 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 $1,875.00. First resistance is seen at the overnight high of $1,966.60 and then at this week’s high of $1,975.80. First support is seen at the overnight low of $1,957.00 and then at $1,950.00. Wyckoff’s Market Rating: 5.0

The silver bulls have the slight overall near-term technical advantage. A downtrend on the daily bar chart has been negated and prices are now trending higher. Silver bulls’ next upside price objective is closing December futures prices above solid technical resistance at $24.00. The next downside price objective for the bears is closing prices below solid support at $22.00. First resistance is seen at this week’s high of $23.49 and then at $23.80. Next support is seen at Wednesday’s low of $22.84 and then at this week’s low of $22.535. Wyckoff’s Market Rating: 5.5.

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