Gold Weaker Amid Upbeat Trader/Investor Attitudes...For Now

(Kitco News) - Gold prices were ending the U.S. day session moderately lower Tuesday. A “risk-on” trader and investor mentality in the marketplace early this week is keeping the safe-haven gold bulls in check. More profit taking was featured after gold scored a 12-month high last Friday. This latest downside price action is just a normal technical correction in an overall price uptrend. The bulls are still in firm chart command in both gold and silver markets. December Comex gold was last down $5.80 an ounce at $1,331.40. December Comex silver prices were last down $0.042 at $17.855 an ounce.

World stock markets were mostly firmer again Tuesday. U.S. stock indexes were mixed at midday but hovering near their recent record highs. That’s a significantly bearish development for the gold market.

News the United Nations Security Council late Monday imposed new sanctions on North Korea that were not as harsh as the U.S. wanted is being perceived as somewhat de-escalating the tensions between the U.S. and North Korea.

It’s important to keep in mind, however, that traders are fickle. Today’s hearty trader/investor risk appetite could quickly turn into tomorrow’s keen anxiety. Don’t expect the U.S.-North Korea dispute of North Korea’s nuclear missiles to just fizzle out. It appears North Korea’s president enjoys his ability to irritate the U.S. How long President Trump puts up with Kim Jong-Un’s intensifying provocations is an unknown. But history shows Trump is not a man that puts up with repeated taunting.

The key outside markets on Tuesday saw the U.S. dollar index slightly lower in midday trading. A modest rebound in the greenback this week is slightly bearish for the precious metals markets. Meantime, Nymex crude oil futures were slightly higher at midday.

The key U.S. economic data point of the week is Thursday’s consumer price index report for August. That report is expected to show a rise of 0.4%. Notions are growing that low inflation in the U.S. and the Euro zone will keep the Federal Reserve and European Central Bank from tightening their monetary policies as soon as they would like. However, recent economic data from China and the U.K. do point to a modest pick-up in inflation. On Tuesday the August producer price index in the U.K. was reported up 0.6% from July and up 2.9%, year-on-year.

Technically, December gold futures prices closed nearer the session high. The gold bulls still have the firm overall near-term technical advantage, but need to show some fresh power soon. Prices are in a nine-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 last week’s high of $1,362.40. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,307.00. First resistance is seen at today’s high of $1,333.50 and then at $1,340.00. First support is seen at today’s low of $1,326.70 and then at $1,320.00. Wyckoff's Market Rating: 7.0

December silver futures prices closed nearer the session high and saw mild profit taking after hitting a four-month high last Friday. The silver bulls have the firm overall near-term technical advantage. Prices are in a nine-week-old uptrend on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $19.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $17.00. First resistance is seen at $18.00 and then at last week’s high of $18.29. Next support is seen at this week’s low of $17.77 and then at $17.50. Wyckoff's Market Rating: 6.5.

December N.Y. copper closed down 310 points at 303.50 cents today. Prices closed nearer the session low and hit a three-week low today. The copper bulls still have the firm overall near-term technical advantage. Some profit taking has been featured. Prices are in a four-month-old uptrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the September high of 317.85 cents. The next downside price objective for the bears is closing prices below solid technical support at 290.00 cents. First resistance is seen at this week’s high of 308.30 cents and then at 310.00 cents. First support is seen at today’s low of 301.90 cents and then at 300.00 cents. Wyckoff's Market Rating: 7.0.