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James Hyerczyk
Gold Bars and Dollar

Gold futures are trading slightly better early Tuesday, remaining just under a 2-1/2 month high hit on Monday. The market continues to be underpinned by safe-haven buying tied to rising political tensions and economic turmoil.

At 1150 GMT, December Comex Gold is trading $1233.40, up $3.00 or +0.24%.

After wallowing in a range for nearly two months, gold finally broke out to the upside, primarily driven by last week’s stock market sell-off. Also helping to boost prices, however, were escalating trade tensions, concerns over slowing global growth, geopolitical tensions and U.S. mid-term election jitters.

The move is being fueled by a strong combination of aggressive short-covering and speculative buying.

Traders are monitoring the geopolitical tensions over the disappearance of the Saudi Arabia journalist, however, so far the news has been limited to the political sphere. Traders essentially want to know if the Saudis are responsible. How the U.S. will respond if they are and whether there will be any retaliation from Saudi Arabia.

Minor reports on Tuesday include: Capacity Utilization, Industrial Production, JOLTS Job Openings, NAHB Housing Market Index and TIC Long-Term Purchases. FOMC Member Daly is scheduled to speak and the Treasury may release its currency report.


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Capacity Utilization is expected to come in slightly better than last month at 78.2%. Industrial Production should dip modestly to 0.2%.

JOLTS Job Openings is expected to come in slightly below last month’s figure at 6.90 Million. The NAHB Housing Index is forecast at 68, up from 67.

TIL Long-Term Purchases are estimated at 50.3 Billion, down from 74.8 Billion.

Capacity Utilization and Industrial Production are likely to move gold prices if they miss a lot to the downside since they indicate economic growth.

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