Gold rebounds as bulls step in to buy the dip

(Kitco News) - Gold prices are solidly higher in midday U.S. trading Thursday, after trading both sides of unchanged on the day. Wednesday’s sharp sell off has been met with bargain-hunting buying interest by the bulls. Weaker stock markets at midday today are also slightly supportive for the safe-haven metals, as is another solid drop in the U.S. dollar index. August gold futures were last up $18.90 an ounce at $1,723.70. July Comex silver prices were last up $0.092 at $18.05 an ounce.

Thursday’s weekly jobless claims data showed 1.88 million in new claims, which was in line with market expectations and had little impact on markets. The marketplace got a pleasant surprise on Wednesday when the May ADP national employment report showed way less job-loss numbers than the marketplace expected. The U.S. Labor Department’s employment situation report for May is out Friday morning, expected to show non-farm payrolls down 8.3 million. In the April jobs report, there was a 20.5 million drop in non-farm payrolls.

Also in focus Thursday was the European Central Bank that held its regular monetary policy meeting. The ECB expanded its Euro bond-buying program by 600 billion Euros and said the program will last into June of 2021. The move by the ECB, while a bit more aggressive, was expected. Meantime, Euro zone retail sales for April were reported down 11.7% from March and down 19.5%, year-on-year, it was reported today.

The other important outside markets see Nymex crude oil prices weaker and trading around $36.80 a barrel. The yield on the benchmark U.S. Treasury 10-year note is currently around 0.8%--well up from levels seen earlier this week. 

Technically, August gold futures bulls have the overall near-term technical advantage but need to show more power soon to restart a price uptrend on the daily bar chart. Gold bulls' next upside near-term price objective is to produce a close above solid technical resistance at this week’s high of $1,761.00. Bears' next near-term downside price objective is pushing prices below solid technical support at $1,668.40. First resistance is seen at Wednesday’s high of $1,738.90 and then at $1,750.00. First support is seen at $1,700.00 and then at this week’s low of $1,690.30. Wyckoff's Market Rating: 7.0

July silver futures were prices were nearer the session high at midday. The silver bulls have the firm 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 Wednesday’s high of $18.405 and then at $18.50. Next support is seen at this week’s low of $17.675 and then at $17.50. Wyckoff's Market Rating: 7.0.

July N.Y. copper closed up 30 points at 249.05 cents today. Prices closed nearer the session high today. Prices Wednesday hit a 10-week high. The copper bulls have the overall near-term technical advantage. 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 this week’s high of 250.50 cents and then at 252.50 cents. First support is seen at today’s low of 245.50 cents and then at this week’s low of 242.35 cents. Wyckoff's Market Rating: 6.5.