(Kitco News) – Gold prices are solidly higher and hit another record high of $1,981.10, basis nearby August Comex futures, in early U.S. trading Friday. Silver prices are also sharply higher. Safe-haven demand and solidly bullish charts are fueling the bull market run in the two metals. A slumping U.S. dollar on the foreign exchange market is adding fuel to the upside for gold and silver markets. August gold futures were last up $28.90 an ounce at $1,971.20. September Comex silver prices were last up $0.828 at $24.185 an ounce.
Gold and silver traders are apparently more concerned about the state of the world economies and geopolitics than are stock market traders. And there’s an old markets adage that the smartest traders are bond traders. U.S. Treasury bond yields this week have moved to near record lows, on safe-haven demand and a flight to quality. The yield on the benchmark U.S. Treasury 10-year note is currently trading around the 0.53% level.
Global stock markets were mostly higher in overnight trading. The U.S. stock indexes are pointed toward modestly higher openings when the New York day session begins. Traders are weighing better-than-expected corporate earnings reports, especially from the big high tech companies, against a stunning drop in U.S. GDP in the second quarter and rising Covid-19 infections in the U.S. Also, Fed Chairman Powell said this week that recent U.S. economic data points to a slowing pace of the recovery. Don’t be surprised on this last trading day of the week and of the month if the latter few of the just-mentioned elements come more into play and the U.S. stock indexes come under selling pressure as the U.S. trading session progresses.
In overnight news, China released more upbeat economic data from its purchasing managers. China’s economy is posting a solid recovery from the Pandemic lockdowns, if one is to fully accept the accuracy of China’s data.
The important outside markets today see Nymex crude oil prices a bit firmer and trading around $40.00 a barrel. The crude oil market bulls have seen their price uptrend on the daily chart stall out. The U.S. dollar index is a lower and hit another nearly two-year low overnight.
U.S. economic data due for release Friday includes personal income and outlays, the employment cost index, the ISM-Chicago business survey, and the University of Michigan consumer sentiment survey.
Technically, the gold bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close in August futures above solid resistance at $2,000.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $1,880.00. First resistance is seen at the overnight record high of $1,981.10 and then at $2,000.00. First support is seen at the overnight low of $1,948.00 and then at Thursday’s low of $1,930.00. Wyckoff’s Market Rating: 10.0
September 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 this week’s high of $26.275 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $22.00. First resistance is seen at Thursday’s high of $24.58 and then at $25.00. Next support is seen at the overnight low of $23.41 and then at $23.00. Wyckoff’s Market Rating: 9.0.
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