Gold price up as it appears inflation genie out of the bottle

New York (Oct 25)  Gold prices are moderately higher in early U.S. trading Monday, supported by increasing worries about problematic price inflation. More and more economists and veteran market watchers are saying the bout of rising global inflation is something more than just transitory. December gold futures were last up $6.50 at $1,802.70. December Comex silver was last up $0.011 at $24.465 an ounce.

Global stock markets were mixed in overnight trading. The U.S. stock indexes are pointed to slightly higher openings when the New York day session begins. It's another big week for U.S. corporate earnings, which have generally been very positive and are helping push the indexes solidly higher from their early October lows. For the moment the upbeat earnings reports are overshadowing worries about "stagflation," which means rising prices and stagnant global economic growth. The mainstream media has recently highlighted the shipping bottlenecks, especially on the U.S. west coast.

News reports over the weekend said the Biden Administration may be getting closer to having the Senate votes for a pared down government spending plan.

The key outside markets today see the U.S. dollar index firmer. Crude oil prices are higher and trading around $84.50 a barrel after hitting a seven-year high overnight. Don't be surprised if continually rising energy prices heading into the Northern Hemisphere winter start to sap trader and investor sentiment. Meantime, the 10-year U.S. Treasury note yield is presently fetching 1.656%.

U.S. economic data due for release Monday includes the Chicago Fed national activity index and the Texas manufacturing outlook survey.

Technically, December gold futures bulls have the overall near-term technical advantage as prices are in a four-week-old uptrend on the daily chart. Bulls' next upside price objective is to produce a close above solid resistance at the September high of $1,836.90. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,750.00. First resistance is seen at today's high of $1,804.60 and then at last week's high of $1,815.50. First support is seen at the overnight low of $1,793.00 and then at Friday's low of $1,783.40. Wyckoff's Market Rating: 6.0

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