Gold prices are again modestly higher in early trading Wednesday, hitting a two-week high, on more short covering and bargain hunting. The yellow metal bulls are also gaining just a bit of near-term technical momentum. August Comex gold was last up $3.40 at $1,263.40 an ounce. Spot gold was last quoted up $3.70 at $1,264.00. July Comex silver last traded up $0.062 at $19.23 an ounce.

In overnight news, the World Bank cut its annual world economic growth forecast to 2.8% from its last forecast of up 3.2%, in January. This news is a bit bullish for the gold market as it hints the world’s major central banks can keep their easy-money policies in place at least a while longer.

A feature in the market place recently has been the sinking value of the Euro currency and the rising value of the U.S. dollar. Last week’s new monetary stimulus measures from the European Central Bank were a bearish underlying development for the Euro currency, as it hovers near a four-month low. Meantime, the U.S. dollar index is trading near a four-month high. This currency price action has historically been bearish for the raw commodity sector, including gold. However, the gold market has just recently rebounded from lower price levels and Nymex crude oil futures prices are at contract highs around $105.00 a barrel.

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the weekly DOE liquid energy stocks report, and the monthly Treasury budget statement.

Wyckoff’s Daily Risk Rating: 5.0 (The Russia-Ukraine crisis has died down in the eyes of the market place, while the rest of the world is also quiet on the geopolitics front.)

(Wyckoff’s Daily Risk Rating is your way to quickly gauge investor risk appetite in the world market place each day. Each day I assess the “risk-on” or “risk-off” trader mentality in the market place with a numerical reading of 1 to 10, with 1 being least risk-averse (most risk-on) and 10 being the most risk-averse (risk-off), and 5 being neutral.

The London A.M. gold fix is $1,262.50 versus the previous P.M. fixing of $1,259.50.

Technically, August gold futures bears still have the overall near-term technical advantage. However, the bulls are gaining some upside technical momentum, but need to show more power to suggest a price uptrend can be sustained. A three-month-old downtrend is still in place on the daily bar chart. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,268.50. Bears' next near-term downside breakout price objective is closing prices below solid technical support at last week’s low of $1,240.20. First resistance is seen at $1,268.50 and then at $1,272.00. First support is seen at the overnight low of $1,257.90 and then at $1,250.00.  

July silver futures bears have the overall near-term technical advantage but prices did hit a two-week high today. Prices are still in a 3.5-month-old downtrend on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $19.50 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at the contract low of $18.615. First resistance is seen at Wednesday’s high of $19.295 and then at $19.50. Next support is seen at $19.00 and then at $18.75.

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