Gold, silver see price advances ahead of U.S. elections

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– Gold and silver futures prices are moderately higher in early U.S. trading Monday, on some more safe-haven demand just one day before the U.S. elections and all of the uncertainty and anxiousness surrounding them. December gold futures were last up $9.40 at $1,889.30 and December Comex silver was last up $0.429 at $24.075 an ounce.

Global stock markets were mostly higher overnight, boosted by upbeat purchasing managers reports out of Asia and Europe. U.S. stock indexes are set to open the New York day session solidly higher. It’s a huge trading week as the U.S. election is Tuesday. Joe Biden has a sizeable lead over President Donald Trump in most polls. However, the polls were wrong in the last U.S. presidential election in 2016. Also, Covid-19 cases continue to rise in the U.S. and Europe, with the U.K. joining France in having to lock down many businesses. U.S. Covid-19 cases are hitting daily records. Still, overall trader and investor risk appetite is upbeat to start the first week of November. It could be that the market place is viewing the U.S. presidential election as win-win for the U.S. stock market–at least for the near term. A Biden victory would likely open up the spigots of massive government spending that would boost the U.S. economy. A Trump victory would keep corporate and individual taxes lower and keep in place business-friendly regulations that Trump put in place during his presidency.

In overnight news, the Euro zone October manufacturing purchasing managers index (PMI) came in at 54.8 versus 53.7 in September. A reading above 50.0 suggests growth in the sector. EU workhorse Germany’s manufacturing PMI was 58.2 in October. Meantime, China’s Caixin manufacturing PMI came in at 53.6 in October versus 53.0 in September, and at a multi-year high. China’s “official” manufacturing PMI, which is a more complete survey, showed a reading of 51.4 in October versus 51.5 in September.

The important outside markets early today see the U.S. dollar index a bit firmer. Nymex crude oil prices are lower early today and hit a five-month low overnight, and presently trading around $34.75 a barrel. Crude oil has been hit by demand concerns amid the renewed lockdowns in Europe that could be a precursor to the U.S. locking down more businesses. The breakdown in crude oil prices is a significantly bearish omen for the entire raw commodity sector. The yield on the benchmark U.S. 10-year Treasury note is 0.86% today.

U.S. economic data due for release Monday includes the U.S. manufacturing PMI, the ISM report on business and manufacturing, construction spending, and the global manufacturing PMI.

Live 24 hours gold chart [Kitco Inc.]

Technically, the December gold futures bulls have the overall near-term technical advantage but are fading. Bulls’ next upside price objective is to produce a close in December futures above solid resistance at the October high of $1,939.40. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the September low of $1,851.00. First resistance is seen at $1,900.00 and then at last week’s high of $1,913.80. First support is seen at the overnight low of $1,873.30 and then at last week’s low of $1,859.20. Wyckoff’s Market Rating: 6.5

Live 24 hours silver chart [ Kitco Inc. ]

December silver futures bulls still have the overall near-term technical advantage as they have stabilized prices the past couple trading sessions. Silver bulls’ next upside price objective is closing prices above solid technical resistance at the October high of $25.71 an ounce. The next downside price objective for the bears is closing prices below solid support at the September low of $21.81. First resistance is seen at last week’s high of $25.765 and then at $25.00. Next support is seen at the overnight low of $23.46 and then at $23.00. Wyckoff’s Market Rating: 6.0.

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