OUTLOOK: Price Signal Summary - Support In Gold Intact For Now

At 00:01 ET 05:01 BST this morning, the US government shut down for the first time since 2018-19, after the Senate rejected a House-passed Continuing Resolution to extend FY25 government funding through November. The Senate also rejected a competing Democratic funding bill that would extend expiring Obamacare subsidies, among a raft of healthcare measures. 

• There are no ongoing negotiations or meetings planned today, but Senate Majority Leader John Thune (R-SD) is likely to hold a third vote on both bills at 11:00 ET 16:00 BST. They are expected to fail again.
• Yesterday’s Senate vote indicated that moderate Democrat support for prolonging a shutdown is not particularly robust. While Senator John Fetterman (D-PA) was the only Democrat ‘yes’ on the first Senate vote last week, that number is now up to three.
• If President Donald Trump and OMB Director Russell Vought follow through on threats to use the shutdown as a pretext to enact mass layoffs across government agencies, moderate Democratic Senators will find it hard to hold the line without a clear endgame.
• Should Democrats maintain their block, the most obvious route out of the shutdown is a deal on extending the expiring Obamacare subsidies. An extension could be included in a rewritten CR or in a handshake deal with Republican leadership. Indeed, Democrats believe that Trump, often out of lockstep with GOP orthodoxy, can be convinced that extending Obamacare subsidies is in his own political interests. 

Full Article: GOVT SHUTDOWN BRIEF

• On the commodity front, the trend condition in Gold is unchanged and a bull cycle remains in play. The yellow metal has traded to a fresh cycle high this week, confirming a resumption of the primary uptrend. Note that moving average studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on $3909.4, a 2.00 projection of the May 15 - Jun 16 - 30 price swing. On the downside, support to watch lies at $3646.3, the 20-day EMA. A pullback would be considered corrective.
• In the oil space, WTI futures have pulled back from their recent gains. The contract has recently breached $65.43, the Sep 2 high and this has potentially improved the S/T condition for bulls. However, the next key resistance is at $68.43, the Jul 30 high, where a break is required to signal scope for a stronger recovery. For bears, a clear reversal lower would refocus attention on key support at $60.85, the Aug 13 low. A break of this level would reinstate the downtrend.

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