Gold Firmer Amid Bullish 'Outside Markets,' Weaker U.S. Equities

(Kitco News) - Gold prices ended the U.S. day session slightly higher Tuesday, lifted in part by a sell-off in the U.S. stock market. The key outside markets were also in bullish postures for the precious metals markets—a weaker U.S. dollar index and firmer crude oil prices. Gains in gold were limited by a batch of U.S. economic reports that were just a bit “hawkish.” June Comex gold futures were last up $2.30 an ounce at $1,276.50. July Comex silver was last up $0.086 at $17.235 an ounce.

The U.S. April consumer price index came in at up 0.4%. The figure was expected to be up 0.3%, and up 0.2% excluding food and energy. April housing starts came in at up 6.6%. That number was forecast at up 4.6%.  The latest report on U.S. industrial production also showed a 0.7% rise in April versus expectations for a 0.3% gain. The data favored the U.S. monetary policy hawks, who would like to see the Fed continue to raise interest rates.

World stock markets were mostly higher overnight, following the lead of crude oil prices that are at six-month highs. Nymex June crude oil prices are near steady in pre-U.S. trading and hovering just below $48.00 a barrel. Bulls are eyeballing the key psychological resistance level of $50.00 as being achievable.

However, U.S. stock indexes could not follow the lead of their overseas counterparts and were under selling pressure Tuesday.

The other key “outside market” on Tuesday saw the U.S. dollar index modestly lower. The greenback bulls still have some momentum on their side after the recent rally in the dollar index.

Technically, June gold futures closed prices closed near mid-range. The gold bulls have the firm overall near-term technical advantage. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the May of $1,306.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at 1,250.00. First resistance is seen at today’s high of $1,283.90 and then at this week’s high of $1,290.40. First support is seen at $1,270.00 and then at $1,264.00. Wyckoff’s Market Rating: 7.0

July silver futures prices closed near mid-range today. The silver market bulls have the overall near-term technical advantage, but have faded as a near-term downtrend is in place on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at the May high of $18.06 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $16.50. First resistance is seen at this week’s high of $17.43 and then at $17.77. Next support is seen at $17.00 and then at last week’s low of $16.85. Wyckoff's Market Rating: 6.5.

July N.Y. copper closed down 45 points at 208.45 cents today. Prices closed nearer the session low today. The copper bears have the firm overall near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 220.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 200.00 cents. First resistance is seen at today’s high of 211.15 cents and then at 214.00 cents. First support is seen at last week’s low of 205.90 cents and then at 202.00 cents. Wyckoff's Market Rating: 2.5.

By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com