Gold, silver back off on normal profit taking in futures mkts

(Kitco News) - Gold and silver prices are solidly lower in midday U.S. trading Tuesday. Some normal profit-taking-pressure was featured by the shorter-term futures traders today, in overall existing strong price uptrends. No chart damage was inflicted. Also keeping buyers of the safe-haven metals more leery on this day is stock market traders that appear to be wearing blinders as they push equities prices farther north--despite keen turmoil in the world. August gold futures were last down $18.10 an ounce at $1,732.30. July Comex silver prices were last down $0.652 at $18.175 an ounce.

Global stock markets were mostly firmer in overnight trading. U.S. stock indexes are mixed at midday. Stock markets are at present seemingly ignoring major storm clouds churning, including the Covid-19 pandemic that has severely crippled world economies, a looming “cold war” between the two largest economies in the world—the U.S. and China, and civil unrest in the U.S. that has exploded into violence not seen in over 50 years. Many market watchers are reckoning the strength of world stock markets is mainly due to the enormous injection of monetary stimulus by central banks into economies that sees much of that money flowing into equities. The juxtaposition of a rallying Wall Street and a struggling Main Street could have significant political implications down the road.

In other news, the U.S. Congressional Budget Office said a full U.S. economic recovery from the damage caused by the pandemic could take 10 years.

The important outside markets see the U.S. dollar index lower today and hitting another 2.5-month low overnight. The greenback is in a swoon due in part to the civil unrest in America. Currencies in countries that are more outside the present fray are benefitting, including the Australian and Canadian dollars and the British pound. Nymex crude oil prices are higher and trading around $36.35 a barrel. The yield on the benchmark U.S. Treasury 10-year note is currently around 0.68%. 

Technically, August gold futures bulls still have the solid overall near-term technical advantage. Gold bulls' next upside near-term price objective is to produce a close above solid technical resistance at the April high of $1,789.00. Bears' next near-term downside price objective is pushing prices below solid technical support at $1,700.00. First resistance is seen at $1,750.00 and then at this week’s high of $1,761.00. First support is seen at $1,720.00 and then at $1,710.00. Wyckoff's Market Rating: 7.0

July silver futures were nearer the session low at midday after hitting a nearly three-month high Monday. The silver bulls still have the solid overall near-term technical advantage. Silver bulls’ next upside price objective is closing prices above solid technical resistance at the February high of $19.075 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $17.15. First resistance is seen at $18.50 and then at this week’s high of $18.95. Next support is seen at $18.00 and then at $17.75. Wyckoff's Market Rating: 7.5.

July N.Y. copper closed up 175 points at 248.85 cents today. Prices closed nearer the session high today and hit another six-week high. The copper bulls have the overall near-term technical advantage and gained fresh power today. Prices are in a 2.5-month-old uptrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 260.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 230.20 cents. First resistance is seen at 250.00 cents and then at 252.50 cents. First support is seen at this week’s low of 242.35 cents and then at 240.00 cents. Wyckoff's Market Rating: 6.5.

By Jim Wyckoff

For Kitco News

 jwyckoff@kitco.com

www.kitco.com