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Gold Down, At 4-Week Low, Ahead Of Jackson Hole Fed

(Kitco News) - Gold prices are down again and hit another four-week low in early U.S. trading Thursday.  More selling pressure developed just after the Comex futures market opened in New York. Technical selling is featured, including more sell stops being triggered. There is also some nervous long liquidation, ahead of an important Fed meeting that begins today. December Comex gold was last down $5.90 an ounce at $1,323.80. December Comex silver was last down $0.083 at $18.605 an ounce.

World stock markets were mostly lower overnight. U.S. stock indexes are pointed toward weaker openings when the New York day session begins. The world marketplace is awaiting the Federal Reserve’s annual symposium that starts Thursday in Jackson Hole, Wyoming. Fed Chair Janet Yellen speaks at the event on Friday. While it’s hoped she will shed new light on the timing of any future interest rate increase from the U.S. central bank, many think her speech will not yield much fresh insight. However, past Jackson Hole Fed confabs have produced markets-moving results.

In overnight news, the closely watched German Ifo business sentiment index fell to a six-month low in August, coming in at 106.2 versus 108.3 in July. A figure of 108.5 was expected. European stock markets were pressured in part on the Ifo report today.

The key “outside markets” on Thursday see Nymex crude oil futures prices slightly lower in early U.S. trading. It appears Nymex oil prices are stuck in a trading range between $40.00 and $50.00 a barrel. Meantime, the U.S. dollar index is also weaker and hovering not far above last week’s seven-week low.

Much of the marketplace is presently in the summer doldrums, which means quieter and lackluster trading conditions. Such is likely to continue until after the U.S. Labor Day holiday in early September.

U.S. economic data due for release Thursday includes the weekly jobless claims report, durable goods orders, the flash services PMI, and the Kansas City Fed manufacturing survey.

(Note: Follow me on Twitter--@jimwyckoff--for breaking market news.)

Wyckoff’s Daily Risk Rating: 2.5 (Trader and investor market risk aversion is not elevated today.)

(Wyckoff’s Daily Risk Rating is your way to quickly gauge investor risk appetite in the world market place each day. Each day I assess the “risk-on” or “risk-off” trader mentality in the market place with a numerical reading of 1 to 5, with 1 being least risk-averse (most risk-on) and 5 being the most risk-averse (risk-off).

Live 24 hours gold chart [Kitco Inc.]

Technically, December gold futures bulls still have the slight overall near-term technical advantage but are fading badly this week. A six-week-old downtrend line is in place on the daily bar chart. Bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,350.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at the July low of $1,318.50. First resistance is seen at the overnight high of $1,330.20 and then at $1,335.00. First support is seen at $1,318.50 and then at $1,310.00. Wyckoff’s Market Rating: 5.5

Live 24 hours silver chart [ Kitco Inc. ]

December silver bulls and bears are on a level overall near-term technical playing field but the bears have momentum on their side. Prices are in a three-week-old downtrend on the daily bar chart. Silver bulls’ next upside price breakout objective is closing futures prices above solid technical resistance at $20.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $18.00. First resistance is at $19.00 and then at this week’s high of $19.385. Next support is seen at the August low of $18.55 and then at $18.25. Wyckoff's Market Rating: 5.0.

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

 

 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.
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