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Both gold and silver prices experienced a virtual breakdown following the release of a report by the US Census Bureau detailing monthly retail and food services sales in August 2021. The report showed consumer spending increased 0.7% to total sales of $ 618.7 billion.
The report said: “The US retail and hospitality sales forecast for August 2021, adjusted for seasonal and public holiday and trading day differences, but not for price changes, was $ 618.7 billion, an increase of $ 618.7 billion 0.7 percent (± 0.5 percent). compared to the previous month and 15.1 percent (± 0.7 percent) over August 2020. Total sales for the period June 2021 to August 2021 rose by 16.3 percent (± 0.5 percent) compared to the same period last year. The percentage change from June 2021 to July 2021 has been revised from minus 1.1 percent (± 0.5 percent) to minus 1.8 percent (± 0.2 percent). Retail sales increased by 0.8 percent (± 0.5 percent) compared to July 2021 and by 13.1 percent (± 0.7 percent) compared to the previous year. Clothing and clothing accessories stores increased by 38.8 percent (± 3.3 percent) compared to August 2020, while petrol stations increased by 35.7 percent (± 1.6 percent) compared to the previous year. “
This report had a huge impact on gold, silver and the dollar market sentiment. The US dollar index gained 0.36% and is currently at 92.855. However, it was gold and silver prices that were absolutely devastated in trade today. As of 5:00 p.m. EDT on a gold futures basis, the most active Comex contract fell USD 41 in December 2021, down 2.26% and fixed at USD 1,753.80. The silver futures base, the most active contract in December 2021, lost $ 0.91 (-3.83%) and is currently pegged at $ 22.89.
The shift in market sentiment is based on the belief that today’s strong retail sales numbers will bolster the tapering narrative at this month’s FOMC meeting. The FOMC meeting begins with the Federal Reserve members meeting on September 21st.
According to Reuters, Bob Haberkorn, chief market strategist at RJO Futures said, “Gold has taken a pretty big slump with the uptrend in dollar and government bond yields and stronger data … they’ve been waiting a long time to get out.” Haberkorn added, “It was because, if there is a geopolitical event or a Fed surprise, the development of gold is unlikely to change until the FOMC meeting. “
Our technical studies show that the first level of potential support for gold is the 61.8% Fibonacci retracement currently pegged at $ 1,738.40, followed by the 78% retracement currently pegged at $ 1,712.80 is. The data set used to create the retracement starts after the August 9 flash crash when gold traded to a low of $ 1,678.10, to the highs on September 3 when gold peaked at 1836 reached $ per ounce.
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As always, I wish you good business and good health,
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. It is not an invitation to exchange goods, securities or other financial instruments. Kitco Metals Inc. and the author of this article assume no responsibility for any loss and / or damage that might arise from the use of this publication.
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