Gold Hits 6-Wk High, On Safe-Haven Buying, Bullish Charts

(Kitco News) - Gold prices were ending the U.S. day session modestly higher and hit a six-week high Monday. Geopolitical developments in the Middle East and an increasingly bullish near-term technical posture are prompting trader and investor buying interest. Gold prices are now within striking distance of the key $1,300.00 mark. August Comex gold was last up $1.70 an ounce at $1,281.90. July Comex silver was last up $0.03 at $17.555 an ounce.

There are some new geopolitical tensions in the Middle East that are prompting a bit of risk aversion that is supporting the safe-haven gold market. Saudi Arabia and a few other Middle East nations have cut ties with Qatar after accusing that small country of promoting terrorism. While not a big deal, this situation reminds the marketplace of the high potential for conflict in the Middle East in the coming months and years.

Another terror attack that killed seven people in London last Saturday had little impact on the world markets Monday. Unfortunately, these acts have become a fact of life in recent years and markets tend to quickly look past them.

Nymex crude oil futures prices were slightly lower Monday. The oil market bears have the firm overall near-term technical advantage. The bearish technical posture for crude oil is a bearish element that will limit the upside in many raw commodity markets, including the precious metals, if oil continues to trend sideways to lower.

The other “outside market” on Monday saw the U.S. dollar index slightly firmer on a short-covering bounce after hitting a six-month low late last week. The greenback bears are also in firm near-term technical control as dollar index prices are in a three-month-old downtrend.

Traders and investors are starting to look over the horizon, as key marketplace developments in the coming days include general elections in the U.K. and a European Union central bank meeting on Thursday, and the Federal Reserve’s FOMC meeting next week.

Technically, August gold futures prices closed nearer the session low today and hit a six-week high early on. The gold bulls have the firm overall near-term technical advantage. Prices are in a four-week-old uptrend on the daily bar chart. 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 today’s high of $1,286.00 and then at $1,290.00. First support is seen at $1,275.00 and then at 1,270.00. Wyckoff's Market Rating: 7.0

July silver futures prices closed near mid-range and hit a five-week high today. The silver market bulls have the slight overall near-term technical advantage. Prices are in a four-week-old uptrend on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $18.00 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 today’s high of $17.65 and then at $17.80. Next support is seen at $17.465 and then at $17.25. Wyckoff's Market Rating: 5.5.

July N.Y. copper closed down 170 points at 255.75 cents today. Prices closed near mid-range today. The copper bulls and bears are on a level overall near-term technical playing field. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 270.00 cents. The next downside price objective for the bears is closing prices below solid technical support at the May low of 247.25 cents. First resistance is seen at today’s high of 257.55 cents and then at 259.60 cents. First support is seen at last week’s low of 252.60 cents and then at 250.00 cents. Wyckoff's Market Rating: 5.0.

(Note: Follow me on Twitter--@jimwyckoff--for breaking market news.)