Gold Slightly Up On Technical Bounce, Weaker Equities

(Kitco News) - Gold prices were ending the U.S. day session slightly higher Wednesday, on some more short-covering in the futures market and on some technical chart consolidation after prices hit a four-week low early on. Mostly weaker world stock markets today also worked in favor of the gold market bulls. August Comex gold was last up $2.40 an ounce at $1,245.80. July Comex silver was last down $0.067 at $16.355 an ounce.

World equity markets were mostly lower Wednesday due in part to falling crude oil prices recently and lower world government bond market yields. Slumping oil prices and lower bond yields suggest inflationary price pressures will remain squelched. While weaker stock markets on this day were a friendly element for safe-haven gold, the specter of very low inflation is an underlying bearish factor for the precious metals and all raw commodity markets.

Gold market watchers need to keep a close watch on U.S.-North Korea tensions. The U.S. citizen who was held captive in North Korea and then died after he returned to the U.S. has many U.S. citizens, congressmen and pundits calling for President Trump to take action. Trump said he will deal with the matter, but just how he reacts is a big question mark. Some are speculating the incident is the tipping point for which the U.S. takes military action to take out North Korea’s ballistic missile capabilities. This matter could well be the next major international incident that drives significant safe-haven demand into the gold market.

The key “outside markets” on Wednesday saw Nymex crude oil futures prices trade lower and hit a 14-month low. The oil market bears have the solid overall near-term technical advantage as prices are trading below $43.00 a barrel. Meantime, the U.S. dollar index was slightly lower today. However, the greenback bulls have gained some upside momentum recently as prices hit a four-week high on Tuesday.

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Technically, August gold futures prices closed near mid-range. The gold bulls and bears are 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 $1,241.70 and then at 1,230.00. Wyckoff's Market Rating: 5.0

July silver futures prices closed nearer the session low and hit another 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 $16.50 and then at this week’s high of $16.68. Next support is seen at today’s low of $16.315 and then at $16.06. Wyckoff's Market Rating: 3.0.

July N.Y. copper closed up 500 points at 260.50 cents today. Prices closed near the session high today and scored a bullish “outside day” up on the daily bar chart. Short covering was featured. 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 today’s high of 260.90 cents and then at 261.95 cents. First support is seen at 256.00 cents and then at today’s low of 253.95 cents. Wyckoff's Market Rating: 5.0.