Gold price erases early losses as U.S. stock market erodes
New York (Sept 8) Gold prices are modestly up and silver near steady in midday U.S. trading Tuesday. Buying interest in the precious metals has been limited today by bearish outside markets that see sharply lower crude oil prices and a solid rally in the U.S. dollar index. However, solid selling pressure in the U.S. stock market is providing a lift to the safe-haven metals. Gold and silver prices are well up from daily lows. October gold futures were last up $3.70 at $1,929.90 and December Comex silver were last down $0.007 at $26.705 an ounce.
Global stock markets were mixed overnight, with Asian shares mostly firmer and European shares mostly weaker. After a long U.S. holiday weekend and the unofficial end to summer, traders and investors are more risk averse to start the U.S. trading week. President Trump on Monday said he might “decouple” the U.S. from China, in the latest salvo in a running feud between the world’s two largest economies.
In other overnight news, the Eurozone’s GDP in the second quarter came in a bit better than expected, at down a revised 11.8% from the first quarter and down 14.7%, year-on-year.
The British pound is seeing selling pressure as the U.K. and the European Union move closer to separating (Brexit).
The important outside markets today see Nymex crude oil prices solidly lower, hitting a six-week low and trading around $36.30 a barrel. Leading oil producer Saudi Arabia has announced it is cutting its oil prices due to likely decreasing demand for crude in the coming months. The U.S. dollar index is solidly higher early today. The yield on the U.S. Treasury 10-year note is trading around 0.67% today.
Technically, October gold futures bulls have the firm overall near-term technical advantage amid recent choppy trading. Prices are still in a five-month-old uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close in October futures above solid resistance at the September high of $1,992.50. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,900.00. First resistance is seen at today’s high of $1,939.10 and then at $1,950.00. First support is seen at today’s low of $1,904.60 and then at $1,900.00.
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