Gold Sees Good Gains, Hits 3-Week High, on Safe-Haven and Technical Buying

(Kitco News) - Gold prices closed near the daily high and hit a three-week high Thursday. Safe-haven demand and more technically related buying were featured. The gold and silver bulls have near-term momentum on their side, to suggest prices can continue to trend sideways to higher in the near term. August Comex gold was last up $11.60 an ounce at $1,273.90. July Comex silver was last up $0.30 at $17.285 an ounce.

World stock markets were mostly lower Thursday, while European government bond yields touched record lows and U.S. bond yields also fell. The benchmark German 10-year bund was fetching a yield of just 0.035%. The U.K. 10-year gilt saw a record-low yield of 1.222%. U.S. 10-year Treasury note futures prices hit a new contract high today. All of the above, sprinkled in with some investor anxiety regarding the upcoming U.K. vote to exit the European Union and about world central banks’ monetary policies, and safe-haven gold saw good demand today.

The gold and silver markets shrugged off the  key “outside markets” being in a bearish posture for the precious metals today, as the U.S. dollar index was higher on an upside correction from recent selling pressure that drove the index to a four-week low on Wednesday. Nymex crude oil futures prices were weaker on some profit taking after hitting a seven-month high on Wednesday. Nymex crude is still trading above $50.00 a barrel.

China got some downbeat data on price inflation Thursday. Consumer inflation was up 2.0% in May, year-on-year, compared with a 2.3% rise in April. The falling inflation rate has many China watchers reckoning China’s central bank may introduce new economic stimulus measures. Markets in China were closed for a public holiday.

Technically, August gold futures prices closed near the session high today. The gold bulls have the overall near-term technical advantage and have gained upside momentum this week. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the March high of $1,286.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at this week’s low of 1,236.90. First resistance is seen at $1,275.00 and then at $1,280.00. First support is seen at today’s low of $1,259.40 and then at $1,250.00. Wyckoff’s Market Rating: 7.0

July silver futures prices closed nearer the session high and hit a three-week high today. The silver market bulls have regained the overall near-term technical advantage. 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 last week’s low of $15.83. First resistance is seen at today’s high of $17.34 and then at $17.50. Next support is seen at today’s low of $16.95 and then at $16.75. Wyckoff's Market Rating: 6.5.

July N.Y. copper closed down 260 points at 203.50 cents today. Prices closed nearer the session low today and hit a four-month low. The copper bears have the solid overall near-term technical advantage and gained more power today. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at this week’s high of 214.50 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the January low of 195.80 cents. First resistance is seen at 205.00 cents and then at today’s high of 208.55 cents. First support is seen at today’s low of 201.30 cents and then at 200.00 cents. Wyckoff's Market Rating: 1.5.

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