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(Kitco News) – Gold and silver prices are solidly lower in early US trading Friday, in the wake of a surprisingly strong US employment report that may force the Federal Reserve to become even more aggressive in its monetary policy tightening. The US dollar index and US Treasury yields jumped on the jobs news, which in turn helped push gold and silver prices down. October gold futures were last down $21.70 at $1,774.70. September Comex silver futures were last down $0.507 at $19.615 an ounce.
This morning’s US jobs report for July, showed a very strong rise of 528,000 in non-farm payrolls job growth. A gain of around 260,000 was expected. The June jobs report showed a rise of 372,000 non-farm jobs. The overall unemployment rate in July fell to 3.5% from 3.6% in June. After today’s strong jobs numbers, “the Fed’s dovish pivot is not going to happen,” said one market commentator on Bloomberg radio.
Global stock markets were flat to slightly up overnight. US stock indexes are pointed toward lower openings when the New York day session beings, and sold off after the strong non-farm payrolls number.
The marketplace is still a little uneasy amid the escalation in tensions between the US and China, the world’s two largest growing, after US House Speaker Nancy Pelosi’s visit to Taiwan this week. China is aggressive military exercises around Taiwan and also announced sanctions against Nancy Pelosi and her family. US Secretary of State Blinken said China’s military exercises near Taiwan are a worrisome escalation.
The key outside markets today see Nymex crude oil prices near steady and trading around $88.50 a barrel. Crude oil on Thursday hit a 4.5-month low. The US dollar index is sharply higher in early US trading and made a big up-move after the jobs report. The yield on the 10-year US Treasury note is fetching around 2.85%.
Other US economic data due for release Friday includes the consumer credit report.
Technically, the October gold futures bears have the overall near-term technical advantage. However, a fledgling price uptrend is still in place on the daily bar chart to suggest a market bottom is in place. Bulls’ next upside price objective is to produce a close above solid resistance at $1,850.00. Bears’ next near-term downside objective price is pushing futures prices below solid technical support at the July low of $1,686.30. First resistance is seen at this week’s high of $1,801.00 and then at $1,825.00. First support is seen at Thursday’s low of $1,769.50 and then at this week’s low of $1,759.70. Wyckoff’s Market Rating: 3.0
September silver futures bears have the overall near-term technical advantage. However, recent price gains suggest a market bottom is in place. Silver bulls’ next upside objective price is closing prices above solid technical resistance at $21.00. The next downside price objective for the bears is closing prices below solid support at $19.00. First resistance is seen at $20.00 and then at this week’s high of $20.51. Next support is seen at $19.40 and then at $19.00. Wyckoff’s Market Rating: 3.0.
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