Gold Hits 12-Mo. Low Amid Dearth Of Bullish News
(Kitco News) - Gold and silver prices are trading modestly lower in early U.S. dealings Thursday. Gold hit a nearly 12-month low overnight. Gold bulls need a good dose of bullish fundamental news. Chart-based sellers in the futures markets have been emboldened this week, amid price downtrends in place for gold and silver. However, both markets are now technically oversold on a short-term basis and due for decent rebounds very soon. Also, the big rally in crude oil prices recently suggests the raw commodity sector has bottomed out and will see better days just ahead. Many raw commodity prices at present are being viewed as value-buying opportunities, on a longer-term basis, including the precious metals. August gold futures were last down $2.50 an ounce at $1,253.60. July Comex silver was last down $0.116 at $16.035 an ounce.
World stock markets were mostly weaker overnight. U.S. stock indexes are pointed toward mixed openings when the New York day session begins. Global trade war fears continue to somewhat limit buying interest in world equity markets.
In overnight news, the Indian Rupee currency hit a new all-time low against the U.S. dollar, in part due to the spike in oil prices the past week. The strong dollar against the Rupee is likely limiting Indian demand for gold (priced in U.S. dollars on the world market). India is a major gold consumer, second only to China.
The U.S. data point of the week is today’s final estimate of first-quarter gross domestic product, which is seen coming in at up 2.2%, year-on-year.
The key “outside markets” today find the U.S. dollar index slightly lower after hitting a 12-month high overnight. Meantime, Nymex crude oil prices are slightly higher and trading just below $73.00 a barrel. Oil prices Wednesday hit a 3.5-year high.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the GDP report and the Kansas City Fed manufacturing survey.
Technically, gold bears have the firm overall near-term technical advantage amid the price downtrend on the daily bar chart. But the market is technically oversold now. Gold bulls' next upside near-term price breakout objective is to produce a close in August futures above solid resistance at $1,286.80. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,230.00. First resistance is seen at Wednesday’s high of $1,261.90 and then at $1,269.40. First support is seen at today’s low of $1,249.60 and then at $1,245.00. 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 $16.75 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the May low of $16.07. First resistance is seen at Wednesday’s high of $16.295 and then at this week’s high of $16.485. Next support is seen at this week’s low of $15.945 and then at $15.805. Wyckoff's Market Rating: 3.0.