June 10, 2023

The price of gold rises with a slightly cooler US consumer price index

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(Kitco News) – Gold and silver prices are clearly higher in early US trading on Thursday, with gold at a seven-week high and silver at a 4.5-month high following a US inflation report that came in just slightly cooler than market expectations. December gold was last up $24.50 at $1,737.90 and December silver was up $0.513 at $21.84.

The just-released US CPI report for October rose 7.7% from a year ago, compared to expectations for a 7.9% increase, compared to an 8.2% increase in the September report. . This report may be the most important data point of the month. A slightly cooler CPI print reading could influence the Federal Reserve’s decision-making process ahead of its December FOMC meeting.

Global stock markets were mostly weaker overnight. U.S. stock indexes are heading for a clearly higher opening as the New York day begins, following a cooler CPI number.

The cryptocurrency market remains in turmoil at the end of this week, with fears of contagion and crypto illiquidity. Broker SP Angel reported via email this morning: A proposed takeover of rival Binance by insolvent crypto exchange FTX is likely to fail, sending Bitcoin down 26% this week and raising concerns about wider market contagion. The FTX exchange, founded by Sam Bankman-Fried (compared to John Pierpont Morgan during the 1907 banking crisis), is seeking support from a reported $8 billion debt shortfall. The exchange’s default has triggered a fall in the value of the crypto market, with the total crypto market valued at $914 billion, down from more than $3 trillion in November 2021. According to JP Morgan, crypto market participants are facing a “cascade” of margin calls, although it is unclear whether this will feed into the broader stock market.

In key external markets, the US dollar index falls sharply after a cooler consumer price index. The price of Nymex crude oil is more stable and is trading around $86.75 per barrel. Oil prices have fallen this week amid concerns over a slowdown in Chinese demand due to an increase in Covid cases. The US 10-year Treasury yield is at 3.931% and has fallen significantly since the cooler CPI report.

Other US economic data to be released on Thursday include the weekly jobless claims report, real earnings and the monthly Treasury budget statement.

Technically, the bears in gold futures still have a small overall near-term technical advantage. However, bulls have momentum, and recent volatile and sideways price action points to a market bottom. This week’s rising bullish trading range on the daily bar chart suggests that there is even more upside to come in the near future. The bulls’ next upside target is to produce above near-fixed resistance at $1,800.00. The Bears’ next near-term bearish objective is to drive futures prices below solid technical support at the November low of $1,618.30. First resistance is seen at $1,750.00 and then at $1,775.00. First support is seen at the overnight low at $1,705.50 and then at $1,700.00. Wyckoff’s market rating: 4.5

Live 24 hour silver chart [ Kitco Inc. ]

The silver bull has a solid near-term technical advantage. The daily bar chart shows a swinging, nine-week-old uptrend. The silver bulls’ next upside price objective is to close above solid technical resistance at $23.00. The next slow target for the bears is to close prices below the stable support at $20.00. First resistance is seen at $22.00 and then at $22.50. The next support is $21.31 and then $21.00. Wyckoff’s market rating: 6.5.

Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect his own Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; However, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. It is not a solicitation to make exchanges in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for any loss and/or damage arising from the use of this publication.

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