Gold sees price pause as U.S. elections approach

(Kitco News) - Gold futures prices are a bit weaker in early U.S. trading Tuesday. The precious metals are pausing ahead of what is arguably the most important event of the trading year—the U.S. elections in one week. Many markets could pause until after the election results are in. Many traders will want to step away from the markets, or take some risk off the table, due to the still highly uncertain outcome of the presidential election. Gold and silver could see some better safe-haven demand in the coming days, heading into the elections. December gold futures were last down $1.00 at $1,904.70 and December Comex silver was last up $0.02 at $24.44 an ounce.

Global stock markets were mostly weaker overnight. U.S. stock indexes are set to open the New York day session slightly up. The global marketplace remains jittery as Covid-19 pandemic infections are on the rise in much of the world, including Europe and the U.S. There are worries new lockdowns are coming this winter, even though they may not be as extreme as seen last spring. Europe is already starting to ramp up its quarantine of some business activities. No vaccine for the virus is close to being released for general distribution.

Major central bank monetary policy meetings this week see the Bank of Canada Wednesday, and European Central Bank and Bank of Japan both meeting Thursday. Deflation has become a bigger concern in Europe.

The important outside markets early today see the U.S. dollar index near steady. Nymex crude oil prices are higher and trading around $39.00 a barrel. The yield on the benchmark U.S. 10-year Treasury note is 0.8% today.

U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, durable goods orders, the monthly house price index, the S&P Core Login housing indexes, the Richmond Fed business survey, and the consumer confidence index.

Technically, the December gold futures bulls have the overall near-term technical advantage amid recent choppy and sideways trading. Bulls are working on a fledgling price uptrend. 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 last Friday’s high of $1,917.30 and then at $1,925.00. First support is seen at Monday’s low of $1,892.50 and then at $1,885.00. Wyckoff's Market Rating: 6.5

December silver futures bulls have the overall near-term technical advantage and are working on a price uptrend. Silver bulls' next upside price objective is closing prices above solid technical resistance at $27.00 an ounce. The next downside price objective for the bears is closing prices below solid support at $22.965. First resistance is seen at Monday’s high of $24.765 and then at $25.00. Next support is seen at Monday’s low of $24.145 and then at $24.00. Wyckoff's Market Rating: 6.5.

By Jim Wyckoff

For Kitco News

 jwyckoff@kitco.com

www.kitco.com