Gold Ends Weaker, Gets No Help from Bullish Outside Markets

(Kitco News) - Gold prices ended the U.S. day session moderately lower Thursday. The yellow metal bulls were disappointed that “outside market” forces were in a bullish posture for gold today—lower U.S. dollar index and sharply higher crude oil prices—yet gold prices could not rally. This suggests the gold market remains firmly gripped by technically oriented bears. June Comex gold was last down $4.70 at $1,204.00 an ounce. July Comex silver was last up $0.037 at $17.15 an ounce.

It was a busy day for U.S. economic data Thursday. Yet, the market place was generally un-phased by the reports, which were a mixed bag.

A feature in the market place this week has been the resurgent U.S. dollar index, despite today’s pullback in the greenback. If the dollar index rebounds and on Friday closes at or near the weekly high close, such would be significantly bearish for the raw commodity market bulls. It would suggest the recent downside pressure on the dollar index was just a technical correction in a longer-term price uptrend that is still up and that is still alive and well. If the dollar index sees selling pressure on Friday and a lower close at or near the weekly low close, it would hint choppy and sideways trading in the index is likely, and that greenback bulls have indeed lost some longer-term technical strength. Such would be bullish for the raw commodity sector. Most raw commodity prices are priced in U.S. dollars on the world market. When the dollar appreciates against the other currencies, it makes those raw commodities more expensive to purchase in non-U.S. currency.

The London P.M. fix is $1,205.00 versus the previous A.M. fixing of $1,209.60.

Technically, June gold futures prices closed nearer the session low. Gold bears have the firm overall near-term technical advantage and have gained some downside momentum this week. Bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at this week’s high of $1,232.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at $1,190.00. First resistance is seen at today’s high of $1,212.40 and then at $1,220.00. First support is seen at $1,200.00 and then at $1,195.00. Wyckoff’s Market Rating: 3.0

July silver futures prices closed near mid-range today. Silver bulls and bears are presently on a level near-term technical playing field. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at this week’s high of $17.775 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $16.50. First resistance is seen at today’s high of $17.25 and then at $17.50. Next support is seen at this week’s low of $16.87 and then at $16.765. Wyckoff's Market Rating: 5.0.

July N.Y. copper closed up 200 points at 284.90 cents today. Prices closed nearer the session high on a corrective bounce from recent selling pressure. The key “outside markets” were bullish for copper today as the U.S. dollar index was lower and crude oil prices were sharply higher. Copper bulls and bears are on a level near-term technical playing field. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at the May high of 295.60 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 275.00 cents. First resistance is seen at today’s high of 286.05 cents and then at 287.50 cents. First support is seen at this week’s low of 282.05 cents and then at 280.00 cents. Wyckoff's Market Rating: 5.0.

By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com
Follow me on Twitter @jimwyckoff