Jim Wyckoff - Daily Gold Market Updates

Gold and silver prices are down and hit two-week lows in early U.S. trading Tuesday. The precious metals markets traders are fretting over notions of tighter monetary policies from major central banks, as bond yields have up-ticked in the wake of last Friday’s speech by Fed Chair Warsh that leaned hawkish. December gold was last down $50.90 at $4,430.70. December silver prices were last down $1.515 at $65.465.

“Global Bond Sell Off Sends Yields to the Highest Level Since 2008.” That’s a Bloomberg headline overnight. “Global bond yields climbed back to the highest level in almost two decades as rising oil prices fueled inflation concerns and investors ramped up expectations for interest-rate hikes. The move started on Friday after Federal Reserve Chairman Kevin Warsh doubled down on his vow to finally tame inflation, and was extended this week as energy prices rose on renewed conflicts in the Middle East,” said the report. “The rate on 10-year Japanese government notes touched 3% for the first time since 1996, U.K. 30-year yields reached the highest since 1998 and the 10-year Treasury rate hit levels last seen January last year. The yield on a Bloomberg gauge of global sovereign bonds advanced for a fourth straight session on Monday, rising to 3.72%, the highest since mid-2008,” said the report.

Prime Minister Narendra Modi said Indians should avoid buying gold unless necessary to curb bullion demand. Modi's comments come amid reports that the government is considering cutting import duties on gold and silver after higher levies failed to curb inflows.

Gold is India's biggest imported commodity after oil and a major contributor to the trade deficit, with inbound shipments of the metal surging in the first four months of the financial year.

Oil tankers attacked in Strait of Hormuz. Two oil supertankers attempting to exit the Strait of Hormuz were struck late Monday by projectiles in quick succession, maritime security consultant Marisks said and as reported by Bloomberg, the latest sign of renewed hostilities around the critical waterway. “The very large crude carrier Sidr, run by Saudi Arabia’s Bahri shipping company, was hit while sailing northeast of Khasab, Oman, the consultant said. The Senegal Prosperity, operated by South Korea’s Sinokor Group, was struck by three projectiles while traveling east of the same country, it said. Both were exiting the Persian Gulf, according to Marisks,” said the report. “Renewed attacks threaten the fragile recovery in oil shipments through the vital chokepoint, which had reached roughly half of pre-war levels thanks to clandestine shuttle runs from major Middle East producers. Crude oil prices rallied on the news.

The key outside markets today see the U.S. dollar index firmer. October Nymex WTI crude oil prices are higher and trading around $88.00 a barrel. The yield on the benchmark 10-year U.S. Treasury yield is presently 4.76%.

Technically, December gold futures bulls’ next upside price objective is to produce a close above solid resistance at the August high of $4,755.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,365.50. First resistance is seen at $4,500.00 and then at this week’s high of $4,521.50. First support is seen at $4,400.00 and then at $4,365.50. Wyckoff's Market Rating: 5.0

September silver futures bulls see their next upside price objective for the bulls is closing prices above solid technical resistance at the August high of 72.05. The next downside price objective for the bears is closing prices below solid support at $60.00. First resistance is seen at this week’s high of $66.18 and then at $68.88. Next support is seen at $65.00 and then at $63.20. Wyckoff's Market Rating: 5.5