Gold prices are slightly higher and silver prices near steady in early U.S. trading Tuesday. The stronger U.S. dollar index that hit a five-week high overnight is a daily bearish “outside-market” element for the precious metals. Metals traders are also tentative as a major central bank meeting is getting under way. August gold was last up $4.00 at $3,314.00. September silver prices were last down $0.001 at $38.22.
The Federal Reserve’s Open Market Committee (FOMC) meeting begins this morning and ends Wednesday afternoon with a statement and press conference from Fed Chairman Jerome Powell. The Fed is widely expected to leave its benchmark Fed funds rate range unchanged this week. However, after being admonished by President Trump to lower U.S. interest rates, many market watchers think Powell might indicate at this meeting the Fed could lean easier on the Fed’s monetary policy intentions this fall.
Asian and European stocks were mixed overnight. U.S. stock indexes are pointed to slightly higher openings today in New York
In other overnight news, posting on social media late Monday in Scotland, President Trump said he is not seeking a summit with Chinese leader Xi but is considering going to China at Xi’s invitation. This comes as U.S. and China trade officials are meeting this week in Stockholm, Sweden. “Trump is facing increased criticism from China hawks in Washington that he’s conceding too much to secure a breakthrough with Xi on trade,” reports Bloomberg. U.S. and Chinese officials Tuesday started a second day of talks aimed at extending their tariff truce beyond a 90-day period that expires in two weeks.
Did the U.S. get the better end of the trade deal with the EU? The currency markets think so. The U.S. dollar index overnight climbed to a five-week high, while the Euro currency dropped below $1.16. The Euro extended Monday’s 1.3% decline, which was the sharpest one-day drop in over two months and hit its weakest level since June 20. “There is growing investor concern that the newly announced trade deal between the U.S. and the European Union disproportionately benefits the U.S., offering little to improve the eurozone’s economic outlook,” reports TradingEconomics.com.
Gold could hit $4,000 an ounce by the end of 2026, according to Fidelity International. That’s due to Federal Reserve interest rate cuts and central banks adding gold to their holdings. Fidelity International’s Ian Samson said the firm remains bullish on gold, citing a clearer path to a more dovish Federal Reserve and the potential for a softer U.S. dollar. Samson said gold’s appeal as a hard asset will continue to be reinforced by growing fiscal deficits, and said the precious metal is not necessarily overstretched in the context of a bull run.
The key outside markets today see the U.S. dollar index higher and hitting a five-week high. Nymex crude oil futures are near steady and trading around $66.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently at 4.394%.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook retail sales report, advance economic indicators, the monthly house price index, the S&P Core Logic home indexes, and the consumer confidence index.
Gold price up a bit as FOMC meeting on deck
Technically, August gold futures bulls have the overall near-term technical advantage but are fading. Bulls’ next upside price objective is to produce a close above solid resistance at the July high of $3,451.70. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the June low of $3,250.50. First resistance is seen at this week’s high of $3,345.40 and then at last Friday’s high of $3,376.60. First support is seen at this week’s low of $3,300.00 and then at $3,275.00. Wyckoff’s Market Rating: 6.0.
September silver futures bulls have the solid overall near-term technical advantage. Prices are in an uptrend on the daily bar chart. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $40.00. The next downside price objective for the bears is closing prices below solid support at $36.00. First resistance is seen at $39.00 and then at $39.57. Next support is seen at $38.00 and then at $37.73.
Source: Kitco
