GOLD: Another Record High for Gold

• China's bond futures are moving in opposite direction in the morning session.  
• The 10-year is lower by -0.02 at 108.36 to remain below all major moving averages.
• The 2-year is up +0.03 at 102.36, nearing the 20-day EMA of 102.37.   

• Ten year government bond yields are modestly lower with the 10-year at 1.72%

Gold prices have been moving in a narrow range during today’s APAC session with few drivers after rising 0.2% to $3348.26/oz on Tuesday as the market priced in a higher probability of a Fed rate cut in September, now around 95%, following July US CPI data showing subdued goods inflation despite higher import duties. 

• Bullion fell to a low of $3342.78 before rising to $3354.35 to be 0.1% higher today at $3351.1. It is trading between initial resistance at $3409.2, 8 August high, and support at $3268.2, 30 July low. The US dollar and yields are also steady.
• Silver has outperformed today rising 0.7% to $38.193, close to the intraday high. It fell to $37.85 early in the session. The technical trend remains bullish with initial resistance at $39.655. Initial support is at $36.216, 31 July low.
• Equities are generally stronger with the Hang Seng up 1.9% and Nikkei +1.6% but S&P e-mini flat and ASX down 0.5%. Oil prices are flat with WTI around $63.18/bbl. Copper is down 0.3%.
• Later the Fed’s Barkin, Goolsbee and Bostic speak. Apart from July updates for German & Spanish CPI, there are no data of note.

The TYU5 range has been 111-23 to 111-27 during the Asia-Pacific session. It last changed hands at 111-27, up 0-01 from the previous close. 

• The US 2-year yield is trading around 3.73%, unchanged from its close.
• The US 10-year yield has edged slightly lower trading around 4.285%.
• Price action in the long-end is a little disconcerting for the bulls though the 10-Year yield still trades below its 4.30/35%% pivot within the wider range 4.10% - 4.65%. There should still be buyers of treasuries on bounces back towards 4.30/35%, looking to initially test the 4.10% area.
• Ben Hunt(Epsilon Theory) on X: “If we’re gonna cut in Sept (90% mkt odds as I write this) with core at 3.1% and rising, wages at 3.9% and rising, stocks and home prices at all-time highs … Can we at least stop talking about the Fed’s 2% inflation ‘target’? It’s just insulting to continue this charade.” 
• Jim Bianco on X: “YoY Core CPI, 3.1%. Up 0.3% in the last 3-months. In the last 40 YEARS, only once has the Fed CUT rates when core was above 3% AND the 3m chg was >0.3%, Oct 1990 to Mar 1991. Agree with @EpsilonTheory, the 2% inflation target is dead. We are accepting a higher inflation world.”
• Data/Events:  MBA Mortgage Applications

Fig 1: 10-Year US Yield 2H Chart

Source: MNI - Market News/Bloomberg Finance L.P