Gold and silver beaten after August 2021 retail sales release

Gold and silver prices both experienced virtual collapse after the release of a US Census Bureau report detailing monthly sales of retail and restaurant services in August 2021. The report indicated a consumer spending increase of 0.7%, totaling sales of $ 618.7 billion.

The report states that “the anticipated estimates of retail sales and food services in the United States for August 2021, adjusted for seasonal variations and differences between holidays and working days, but not price changes, were $ 618.7 billion, an increase of 0.7% (± 0.5%) from the previous month and 15.1% (± 0.7%) above August 2020. Sales Total for the period June 2021 to August 2021 increased by 16.3% (± 0.5%) compared to the same period a year ago. The percentage change from June 2021 to July 2021 has been revised from 1.1% (± 0.5%) to 1.8% (± 0.2%). Retail sales increased 0.8% (± 0.5%) from July 2021 and 13.1% (± 0.7%) from a year ago. Clothing and clothing accessories stores grew 38.8% (± 3.3%) from August 2020, while gas stations grew 35.7% (± 1.6%) per compared to last year.

This report had a huge impact on the sentiment of the gold, silver and dollar market. The US dollar index gained 0.36% and is currently pegged at 92.855. However, it is the prices of gold and silver that have been absolutely devastated in trading today. At 5:00 p.m. EDT, based on gold futures, the most active December 2021 Comex contract is down $ 41, down 2.26%, and pegged at $ 1,753.80 . Based on silver futures, the most active contract in December 2021 lost $ 0.91 (-3.83%) and is currently pegged at $ 22.89.

The change in market sentiment is based on the belief that today’s strong retail sales figures will strengthen the narrative of the decline at this month’s FOMC meeting. The FOMC meeting will begin when Federal Reserve members meet on September 21.

According to Reuters, Bob Haberkorn, senior market strategist at RJO Futures, said: “Gold has been hit hard, with the dollar and Treasury yields rising and the data stronger… Haberkorn added that“ unless geopolitical event or Fed surprise, gold’s path is unlikely to change before the FOMC meeting ”.

Our technical studies indicate that the first level of potential support for gold is at the 61.8% Fibonacci retracement level, which is currently pegged at $ 1,738.40, followed by the 78% retracement, which is currently pegged. at $ 1,712.80. The data set used to create the retracement begins after the lightning crash that occurred on August 9 when gold traded at a low of $ 1,678.10, to highs reached on September 3 when the gold peaked at $ 1,836 an ounce.

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Wishing you, as always, good exchanges and good health,

Disclaimer: The opinions 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 strictly for informational purposes. It is not a solicitation to effect an exchange of commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for any loss and / or damage resulting from the use of this publication.

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