Market Overview
Gold and silver prices are firmer in quieter early U.S. trading Monday. A weaker U.S. dollar index is a supportive outside market element lifting the metals markets to start the trading week. Short covering in the gold and silver futures markets is featured ahead of a key U.S. inflation report on Wednesday.
Inflation Report and ECB Meeting
Traders and investors are waiting for the next major U.S. data point, which is the consumer price index report for August out Wednesday morning. The CPI is expected to be up 4.3%, year-on-year, versus a 4.7% rise in the July report. The European Central Bank also holds its regular monetary policy meeting this week and is expected to slightly raise its main interest rate by 0.25 percent.
Market Shift in Fed Officials’ Stance
According to a Wall Street Journal article, Fed officials, including Chairman Jay Powell, now have a more balanced approach on monetary policy. The Fed is more worried about further interest rate increases causing an unnecessary U.S. recession.
Key Market Indicators
The key outside markets today see the U.S. dollar index lower. Nymex crude oil prices are weaker and trading around $87.00 a barrel. The benchmark U.S. Treasury 10-year note yield is presently fetching 4.294%.
Technical Analysis
Technically, the gold futures bears have the overall near-term technical advantage. The next upside price objective for bulls is to produce a close in December futures above solid resistance at the September high of $1,980.20. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the August low of $1,913.60.
The silver bears also have the overall near-term technical advantage. The next upside price objective for silver bulls is closing December futures prices above solid technical resistance at this week’s high of $24.655. The next downside price objective for the bears is closing prices below solid support at the August low of $22.585.
