(Kitco News) – Gold prices are modestly up and hit a 6.5-year high in overnight trading, while the silver market sees solid gains and hit a two-year high. Geopolitics is on the front burner of the market place this week, which is helping to lift the safe-haven metals. Their technical postures are also fully bullish, which continues to invite the chart-based buyers. December gold futures were last up $2.20 an ounce at 1,539.60. September Comex silver prices were last up $0.207 at $17.62 an ounce.
The unexpected twists and turns in the U.S.-China trade war continue, as President Trump early Monday morning said Chinese trade officials called U.S. trade officials Sunday evening to restart discussions. Trump said China “wants to make a deal” and “that’s a great thing.” Chinese officials, when questioned on the matter, were murky on whether a telephone call actually took place.
Still, the gold market backed way down from its overnight high of $1,565.00, basis December futures. Meantime, markets in Asia and Europe that were under selling pressure early on rebounded when the Trump news hit the news wires. U.S. stock indexes are pointed toward higher openings when the New York day session begins. The surprise news Monday comes after Trump on Friday unleashed a barrage of negative tweets on China, including “demanding” that U.S. businesses leave there.
Tensions in Hong Kong remain high amid civil unrest there. Reports said weekend clashes between protesters and police escalated, including protesters throwing rocks and police using water cannons.
The weekend G-7 summit in Paris produced nothing major that the marketplace deemed as price-sensitive. Trump had a chance to meet with Iran’s foreign minister who showed up unexpectedly, but declined to do so.
In other overnight news, the closely watched German Ifo business conditions index in August fell to 94.3 versus expectations of a reading of 95.1.
The key “outside markets” today see Nymex crude oil prices firmer and trading around $54.50 a barrel. The U.S. dollar index is solidly higher.
U.S. economic data due for release Monday includes the Chicago Fed national activity index, durable goods orders and the Texas manufacturing outlook survey.
Technically, the gold bulls have the solid overall near-term technical advantage. A nearly three-month-old uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close in October futures above solid resistance at $1,600.00. Bears’ next near-term downside price breakout objective is pushing December futures prices below solid technical support at $1,500.00. First resistance is seen at $1,546.10 and then at 1,550.00. First support is seen at the overnight low of $1,534.80 and then at $1,525.00. Wyckoff’s Market Rating: 8.0.
September silver futures bulls have the solid overall near-term technical advantage. Prices are in a three-month-old uptrend on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $18.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at last week’s low of $16.82. First resistance is seen at the overnight high of $17.755 and then at $18.00. Next support is seen at $17.465 and then at $17.37. Wyckoff’s Market Rating: 8.0.
By Jim Wyckoff
For Kitco News
Contact jwyckoff@kitco.com
www.kitco.com
