Comex gold futures are trading slightly lower Tuesday morning in more quiet market activity. Tuesday is the last trading day of the month and the gold market is seeing some book-squaring and profit taking by traders, amid a general consolidation mode ahead of Friday's important U.S. employment report. December gold last traded down $2.50 an ounce at $1,236.70. Spot gold was last quoted down $2.00 at $1,235.00.

The U.S. dollar index is trading slightly lower Tuesday, while the U.S. stock indexes are also weaker. Crude oil prices are lower. These key "outside markets" are not providing strong price direction for the precious metals so far Tuesday.

Trading is quieter so far this week in the U.S. and European markets, as the month of August ends and ahead of the last summer holiday weekend in the U.S.

Precious metals traders are awaiting Friday's U.S. employment report, which is expected to show the key non-farm payrolls figure to be down 123,000 in August, following a decline of 131,000 jobs in July. The unemployment rate is forecast to come in at 9.6% from the July reading of 9.5%. Look for more active trading in the precious metals and other markets in the immediate aftermath of Friday morning's jobs data.

Major U.S. economic data due out Tuesday includes the ISM New York and Chicago business indexes, the Case-Shiller home price index and the consumer price index and the FOMC meeting minutes.

The London A.M. gold fixing was $1,233.50 versus the previous London P.M. fixing of $1,235.00.

Technically, there is not a lot new in the gold market recently. Bulls still have the overall near-term technical advantage. Comex gold prices are in a solid five-week-old uptrend on the daily bar chart. The longer-term charts also still fully favor the gold market bulls, as they, too, show longer-term price uptrends in place.

The next near-term upside price objective for the gold market bulls is to push and close December futures prices above solid chart resistance at $1,250.00. The bears' next near-term downside price objective is producing a close in December gold futures below solid chart support at last week's low of $1,211.70.

For December gold, shorter-term technical resistance is located at the overnight high of $1,239.80 and then at last week's high of $1,246.00. Buy stops likely reside just above those levels. Sell stops likely reside just below chart support at the overnight low of $1,233.50 and then at $1,230.00. Today's key near-term Fibonacci pivot level for December gold: $1,228.00.

Comex silver futures are weaker Tuesday morning, on some profit-taking pressure following recent solid gains. December silver last traded down 8.9 cents at $18.985 an ounce. The silver bulls still have the overall near-term technical advantage. Silver will continue to generally follow the lead of the gold market.

The next near-term upside price objective for the silver market bulls is to push and close December Comex futures prices above solid chart resistance at the June high of $19.55 an ounce. The next downside price objective for the silver bears is to push and close December silver prices below solid technical support at $18.40.

December silver finds shorter-term technical resistance at overnight high of $19.135 and then at this week's high of $19.275. Buy stops likely reside just above those levels. Shorter-term technical support for December silver is located at the overnight low of $18.86 and then at $18.75. Sell stops are likely placed just below those levels. Today's key Fibonacci pivot level for December silver futures is located at $18.93.

By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com

Editor’s Note: Meet the Kitco News Team at the upcoming Kitco Metals eConference September 12-13, 2010. A not-to-be missed event featuring Ron Paul, Marc Faber and other industry heavyweights. The eConference is free with Pre- Registration www.kitcoeconf.com.

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