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(Kitco News) – Gold and silver prices were solidly lower in early US trading on Friday. Gold hit a five-month low and silver hit a two-year low overnight. Metals are feeling pressure from a strong US dollar index, which is near its latest 20-year high, and from near-term charts that are significantly more bearish this week. That is inviting technically oriented speculators to play the short side of the gold and silver futures markets. August gold futures were down $20.30 at $1,787.00. July Comex silver futures were up $0.872 at $19.41 an ounce.
Global stock markets fell almost overnight. US stock indices are pointed towards lower openings on the first trading day of this month and the opening of the New York day session in the second half of 2022. Potential US and/or global recessions are currently on the market’s front burner. , and it is bearish for equities. Major central banks have signaled to markets that reducing inflation is more important than growing the economy. A market participant in a Dow Jones Newswires story said: “We can see the foundations are being set for an economic downturn. The Russia-Ukraine war remains a significant drag on trader and investor risk sentiment.
In overnight news, the euro zone reported that its consumer inflation rose to a record high of 8.6% year-on-year in June. That compares with expectations for an 8.1% rise in May and an 8.4% rise in June.
Major outside markets today saw Nymex crude oil prices higher and trading around $108.80 a barrel. The US dollar index was solidly higher in early US trade. The yield on the 10-year US Treasury note is fetching 2.954%.
US economic data to be released on Friday includes US manufacturing purchasing managers’ index (PMI), ISM report on business manufacturing, global manufacturing PMI, construction spending and domestic auto industry sales.
Technically, August gold futures bears have a solid overall near-term technical advantage, as prices hit five-month lows overnight. The next upside price objective for the bulls is to produce above solid resistance at $1,850.00. The bears’ next near-term downside price objective sees futures prices below solid technical support at $1,750.00. First resistance is seen at $1,800.00 and then today’s high at $1,808.70. First support is seen at $1,775.00 and then $1,765.00. Wyckoff’s Market Rating: 2.0.
July silver futures bears have a solid overall near-term technical advantage, as prices are near two-year lows. The next upside price objective for silver bulls is a close above solid technical resistance at $21.00 an ounce. The next downside price objective for bears is closing prices below solid support at $19.00. The first resistance is seen at $20.00 and then the overnight high at $20.185. The next support is found at $19.25 and then $19.00. Wyckoff’s Market Rating: 1.0.
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