Gold Slightly Up After Big Downdraft Last Friday

(Kitco News) - Gold prices are slightly higher in early-afternoon U.S. trading Monday. The market saw a tepid corrective and short-covering bounce after sharp losses suffered on Friday that saw the yellow metal hit a six-month low. There was also some risk aversion in the marketplace today that might also be giving gold some mild support. August Comex gold futures were last up $2.00 an ounce at $1,280.40. July Comex silver was last down $0.025 at $16.45 an ounce.

A major bearish weight on the precious metals recently has been the resurgent U.S. dollar index, which hit an 11-month high last Friday.

Much of the raw commodity sector got hit hard last Friday on world trade concerns. Traders are still in a risk-averse mood early this week. World trade war worries continue to be on the front burner of the marketplace, as the world’s two largest economies—the U.S. and China—square off. Unfortunately for the gold market bulls, their yellow metal now wants to act like a raw commodity instead of a safe-haven store of value. Still, the trade tensions worldwide could support the gold market if the situation deteriorates further.

The key “outside markets” today see the U.S. dollar index firmer and not far below last week’s 11-month high. Meantime, Nymex crude oilprices are modestly higher and are trading just above $65.00 a barrel.

There was no major U.S. economic data released today.

Technically, the gold bears have regained the overall near-term technical advantage. A nine-week-old downtrend has been re-established on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close in August futures above solid technical resistance at $1,300.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the December low of $1,251.90. First resistance is seen at $1,285.00 and then at $1,293.10. First support is seen at last week’s low of $1,277.90 and then at $1,275.00. Wyckoff's Market Rating: 4.0

Silver prices closed nearer the session low today. The silver bears have regained the overall near-term technical advantage after big losses last Friday. Silver bulls' next upside price breakout objective is closing July futures prices above solid technical resistance at last week’s high of $17.35 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the May low of $16.07. First resistance is seen at today’s high of $16.425 and then at $16.50. Next support is seen at $16.31 and then at $16.19. Wyckoff's Market Rating: 4.0.

July N.Y. copper closed down 365 points at 310.80 cents today. Prices closed nearer the session low. The copper bulls have lost their overall near-term technical advantage amid the big sell off recently. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the June high of 331.55 cents. The next downside price objective for the bears is closing prices below solid technical support at 300.00 cents. First resistance is seen at 313.00 cents and then at today’s high of 315.15 cents. First support is seen at today’s low of 309.65 cents and then at 307.00 cents. Wyckoff's Market Rating: 5.0.