Gold Ends Lower; Risk-On Marketplace Just Ahead Of Brexit Results

(Kitco News) - Gold prices ended the U.S. day session moderately lower and hit a two-week low Thursday. Risk appetite in the marketplace is on the upswing this week, which has been bearish for safe-haven gold. The highly anticipated Brexit vote is taking place today, with most believing the U.K. will stay in the European Union. August Comex gold was last down $6.30 an ounce at $1,263.60. July Comex silver was last up $0.028 at $17.34 an ounce.

Traders and investors reckon U.K. voters will elect to stay in the European Union—despite some polls that are very close on the U.K. staying or leaving the EU. However, London bookmakers show odds are 80% that voters will opt to stay in the EU. A U.K. vote to leave the EU would surprise the marketplace and likely create high uncertainty and tensions in world stock, currency, commodity and financial markets. Results of today’s vote should start to trickle in late Thursday evening, U.S. time.

Interestingly, reports are saying that some currency trading desks around the world have said they will not accept or honor stop-loss orders on trades starting late Thursday into Friday. That suggests more than just a few market watchers and brokers are worried about extreme price volatility that could occur in the wake of the Brexit vote results. Even the “smart money” in the markets is worried about the events that will unfold the next 24 hours—even though the bookies place high odds on the “stay” vote winning.

The key “outside markets” on Thursday saw the U.S. dollar index weaker and hitting a seven-week low as the greenback bears have downside momentum. Nymex crude oil prices were firmer and trading just below $50.00 a barrel.

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Technically, August gold futures prices closed nearer the session low and scored a bearish “outside day” down on the daily bar chart today. The gold bulls still have the overall near-term technical advantage but are fading badly this week. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,300.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,250.00. First resistance is seen at $1,275.00 and then at $1,280.00. First support is seen at today’s low of $1,259.90 and then at $1,250.00. Wyckoff’s Market Rating: 6.5

July silver futures prices closed near mid-range today. The silver market bulls still have 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 $16.75. First resistance is seen at today’s high of $17.50 and then at this week’s high of $17.66. Next support is seen at last week’s low of $17.105 and then at $17.00. Wyckoff's Market Rating: 6.5.

July N.Y. copper closed up 270 points at 216.25 cents today. Prices closed nearer the session high and hit a seven-week high today, on more short covering and bargain hunting. The key “outside markets” were bullish for copper today, as the U.S. dollar index was lower and crude oil prices were higher. The copper bulls and bears are now back on a level overall near-term technical playing field. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 225.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the June low of 201.30 cents. First resistance is seen at today’s high of 216.80 cents and then at 220.00 cents. First support is seen at today’s low of 212.55 cents and then at 210.00 cents. Wyckoff's Market Rating: 5.0.

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