Gold, silver see price advances and greenback backs down

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(Kitco News) – Gold and silver futures prices are moderately higher in early U.S. trading Friday. The precious metals continue to trade in an inverse fashion with the daily movements of the U.S. dollar index, which is lower today. There may also be a bit of safe-haven buying heading into the weekend. December gold futures were last up $9.00 at $1,913.60 and December Comex silver was last up $0.156 at $24.865 an ounce.

Reuters today reported world central banks became net sellers of gold for first time in a decade in the third quarter. The report said gold demand is down 30%, year-on-year, mostly due to the Covid-19-induced damage to the world economies. Jewelry fabrication remained the worst impacted sector.  

Global stock markets were mixed to slightly up overnight, with Asian shares mixed and European shares mostly firmer. U.S. stock indexes are set to open the New York day session slightly higher. The stock indexes are drifting at present and such will likely continue to be the case until after the U.S. elections in early November.

Markets showed little reaction to Thursday evening’s U.S. presidential debate, which was more civil than the first one. No candidate made any major gaffe and most felt there was no big winner in the debate.

Covid-19 stimulus package discussions between U.S. congressional Democrats and Republicans continue. While a package at some point is likely, it very likely won’t come before the election in early November.

In overnight news, the Euro zone composite purchasing managers index (PMI) for October came in at 49.4 versus 50.4 in September. The October number was just slightly above market expectations.

The important outside markets early today see the U.S. dollar index weaker. Nymex crude oil prices are higher and trading around $40.75 a barrel. The yield on the benchmark U.S. 10-year Treasury note is 0.84% today.

U.S. economic data due for release Friday includes the U.S. flash manufacturing purchasing managers index (PMI), and the flash services PMI.

Technically, the December gold futures bulls have the overall near-term technical advantage amid recent choppy and sideways trading. Bulls are working on a fledgling price uptrend. Bulls’ next upside price objective is to produce a close in December futures above solid resistance at the October high of $1,939.40. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the September low of $1,851.00. First resistance is seen at this week’s high of $1,936.00 and then at the October high of $1,939.40. First support is seen at today’s low of $1,903.20 and then at $1,900.00. Wyckoff’s Market Rating: 6.5

December silver futures bulls have the overall near-term technical advantage and are working on a price uptrend. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $27.00 an ounce. The next downside price objective for the bears is closing prices below solid support at $22.965. First resistance is seen at this week’s high of $25.425 and then at the October high of $25.71. Next support is seen at Thursday’s low of $24.46 and then at $24.215. Wyckoff’s Market Rating: 6.5.