Gold, Silver Prices Down On Technical Selling

(Kitco News) - Gold prices are moderately lower and hit another six-month low in early-afternoon U.S. trading Wednesday. Silver prices are slightly lower and hit a four-week low. The near-term technical postures for both metals have deteriorated the past week, which is inviting the chart-based sellers into the futures markets. August Comex gold futures were last down $4.00 an ounce at $1,274.60. July Comex silver was last down $0.008 at $16.315 an ounce.

The safe-haven gold market can’t hold a bid despite some risk aversion seen in the marketplace this week, due to worries about a global trade war. It seems the specter of less global commerce in raw commodities if a trade war would break out is trumping safe-haven buying. Gold bulls are frustrated because at present their metal is acting like a raw commodity instead of a safe-haven asset.

A strong U.S. dollar is also working against the precious metals markets. The U.S. dollar index hit another 11-month high overnight. Since gold is priced in U.S. dollars on most world markets, any appreciation of the greenback makes the metal more expensive to purchase in non-U.S. currency.

The other key “outside market” today finds Nymex crude oil prices firmer and trading just above $65.00 a barrel. Oil traders are looking ahead to the late-week OPEC meeting, at which time Saudi Arabia and Russia are expected to announce they will increase oil production.

Technically, gold bears have the overall near-term technical advantage. A nine-week-old downtrend is in place 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 the December low of $1,251.90. First resistance is seen at $1,280.00 and then at this week’s high of $1,286.80. First support is seen at today’s low of $1,272.10 and then at $1,265.00. Wyckoff's Market Rating: 3.5

The silver bears have the overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing 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 $16.50 and then at this week’s high of $16.635. Next support is seen at this week’s low of $16.24 and then at $16.07. Wyckoff's Market Rating: 3.0.

July N.Y. copper closed down 120 points at 303.55 cents today. Prices closed nearer the session low. The copper bears have the overall near-term technical advantage amid the steep sell off recently. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 320.00 cents. The next downside price objective for the bears is closing prices below solid technical support at the March low of 295.85 cents. First resistance is seen at today’s high of 306.75 cents and then at 310.00 cents. First support is seen at today’s low of 302.10 cents and then at 301.00 cents. Wyckoff's Market Rating: 3.0.