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Gold Sees Normal Profit-Taking From Recent Gains

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(Kitco News) - Gold prices were ending the U.S. day session modestly lower Tuesday. Some profit taking from the shorter-term futures traders was featured, which is not unexpected after recent price gains that saw the precious metal hit a four-week high on Monday. There was also some backing and filling on the gold charts amid the near-term price uptrend. August Comex gold was last down $2.60 an ounce at $1,251.70. September Comex silver was last up $0.057 at $16.50 an ounce.

Some upbeat U.S. economic data released at late-morning, in the form of the July consumer confidence index and the Richmond Fed business survey, lifted the U.S. dollar index from its daily low, which in turn put some downside price pressure on the gold market. Gold prices had erased overnight losses and were trading near steady when the upbeat U.S. reports hit the newswires.

A weaker U.S. dollar index that hit another 13-month low overnight is still limiting selling interest in the precious metals. The greenback has been on a downhill slide against the other major currencies since January.

Focus of the world marketplace is on the Federal Reserve’s Open Market Committee meeting (FOMC) that began Tuesday morning and ends early Wednesday afternoon with a statement. No changes in U.S. monetary policy are expected. However, the Fed could indicate the timing of reducing its big balance sheet of U.S. securities. The tone of the FOMC statement will also be important for markets. Just recently Federal Reserve Chair Janet Yellen has sounded a more dovish tone on U.S. monetary policy.

The other “outside market” on Tuesday morning saw Nymex crude oil futures solidly higher and hitting a six-week high. OPEC oil ministers were meeting in St. Petersburg, Russia. Saudi Arabia has chastised cartel member nations for not adhering to their production quotas and has pledged to cut even more of its own oil production levels.

Live 24 hours gold chart [Kitco Inc.]

Technically, August gold futures prices closed nearer the session low today. The gold bulls still have the slight overall near-term technical advantage. Prices are in a steep two-week-old uptrend on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,270.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,220.00. First resistance is seen at this week’s high of $1,259.00 and then at $1,270.00. First support is seen at today’s low of $1,248.80 and then at $1,242.80. Wyckoff's Market Rating: 5.5

Live 24 hours silver chart [ Kitco Inc. ]

September silver futures prices closed nearer the session high and hit another three-week high today. While the silver bears still have the overall near-term technical advantage recent price action suggests a near-term market bottom is in place. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $17.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the July low of $15.145. First resistance is seen at today’s high of $16.605 and then at $16.75. Next support is seen at today’s low of $16.225 and then at $16.00. Wyckoff's Market Rating: 3.0.

September N.Y. copper closed up 1,040 points at 284.05 cents today. Prices closed nearer the session high today and hit a two-year high. The copper bulls have the solid overall near-term technical advantage and gained more power today. 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 300.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 270.00 cents. First resistance is seen at today’s high of 285.40 cents and then at 287.50 cents. First support is seen at 280.00 cents and then at 275.00 cents. Wyckoff's Market Rating: 8.0.

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.