Gold, Silver Prices Rebound From Multi-Month Lows
(Kitco News) - Gold and silver prices are moderately higher in early U.S. trading Tuesday, on some short covering in the futures markets and perceived bargain-basement buying in the cash markets. Gold hit a 12-month low overnight and silver scored a 6.5-month low on Monday. The key “outside markets” are also in a bullish daily posture for the precious metals markets today, as the U.S. dollar index is lower and crude oil prices are higher. August gold futures were last up $7.10 an ounce at $1,248.80. July Comex silver was last up $0.14 at $15.975 an ounce.
Reports overnight said Monday’s trading in gold exchange traded funds saw the largest outflow of money from those funds since late March. Gold and silver bulls remain stymied by their metals’ inability to rally in the face of the threat of a global trade war and some fresh instability in the European Union.
World stock markets were mixed to higher overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins.
European stock markets were assuaged today on news that German Chancellor Merkel has apparently avoided a political crisis by coming to agreement with other German lawmakers regarding immigration laws.
In other overnight news, the Euro zone’s producer price index in May was reported up 0.8% from April and up 3.0%, year-on-year. Those numbers were a little higher than expected.
The U.S. Independence Day holiday is on Wednesday, which is likely to make trading in the U.S. light today, especially as many markets close early today. However, some important U.S. economic data is out later this week, including the Fed’s FOMC minutes on Thursday and the jobs report from the Labor Department on Friday.
The key “outside markets” today find the U.S. dollar index lower but still not far below the 12-month high hit last week. Meantime, Nymex crude oil prices are higher, hit a 3.5-year high and trading just below $75.00 a barrel.
U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the ISM New York report on business, manufacturers’ shipments and inventories, the IDB/TIPP economic optimism index and domestic auto industry sales.
Technically, gold bears have the firm overall near-term technical advantage amid the price downtrend on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close in August futures above solid resistance at $1,275.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,230.00. First resistance is seen at $1,257.10 and then at $1,261.90. First support is seen at the overnight low of $1,238.80 and then at $1,230.00. Wyckoff's Market Rating: 2.5
July silver futures bears have the firm overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $16.50 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the December low of $15.50. First resistance is seen at Monday’s high of $16.18 and then at $16.25. Next support is seen at Monday’s low of $15.80 and then at $15.75. Wyckoff's Market Rating: 2.5.