Gold Down Amid Bearish "Outside Market" Forces

(Kitco News) - Gold prices ended the day with modest losses and hit another four-week low Tuesday. Some mild short-covering in the futures market and bargain hunting in the cash market seen early in the session gave way to the sellers later in the day, who were emboldened by falling crude oil prices and a rebound in the U.S. dollar. August Comex gold was last down $2.60 an ounce at $1,244.10.July Comex silver was last down $0.072 at $16.43 an ounce.

The key “outside markets” on Tuesday saw Nymex crude oil futures prices trade solidly lower and hit a seven-month low. The oil market bears have the solid overall near-term technical advantage as prices traded below $43.00 a barrel today. There continue to be notions of a worldwide oil supply glut that will continue to depress prices for some time to come.

Meantime, the U.S. dollar index was firmer today on some short covering and continuing growing notions of a more hawkish Federal Reserve. The greenback bears still hold the overall near-term technical advantage, but the dollar index appears to have stabilized from recent selling pressure.

The world geopolitical front has seen just a bit of turbulence this week. A U.S. citizen held captive in North Korea for over a year and just returned home has died. A U.S. warplane shot down a Syrian jet, which has prompted a stern rebuke from Russia. While potentially market-sensitive at some point soon, these events have so far had very little impact on the world marketplace.

Several Federal Reserve officials speak this week and the marketplace will closely scrutinize their comments for any clues on the future direction of U.S. monetary policy.

A speech on U.S. tax reform by U.S. House of Representatives Speaker Paul Ryan that just concluded had very little if any impact on markets prices.

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

August gold futures prices closed near mid-range. The gold bulls and bears are now on a level overall near-term technical playing field. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,275.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,225.00. First resistance is seen at $1,250.00 and then at this week’s high of $1,257.30. First support is seen at today’s low of $1,242.40 and then at 1,230.00. Wyckoff's Market Rating: 5.0

July silver futures closed down $0.067 at $16.43 today. Prices closed nearer the session low and hit a five-week low today. The silver bears have the firm overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $17.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the May low of $16.06. First resistance is seen at this week’s high of $16.68 and then at $16.80. Next support is seen at today’s low of $16.36 and then at $16.25. Wyckoff's Market Rating: 3.0.

July N.Y. copper closed down 320 points at 255.75 cents today. Prices closed nearer the session low today. The key “outside markets” were bearish for copper today as the U.S. dollar index was firmer and crude oil prices were solidly lower. The copper bulls and bears are on a level overall near-term technical playing field amid choppy trading. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the June high of 265.20 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 this week’s high of 259.80 cents and then at 261.95 cents. First support is seen at today’s low of 254.55 cents and then at last week’s low of 253.40 cents. Wyckoff's Market Rating: 5.0.