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Gold Prices Trek Farther North, Hit 6 Yr. Highs

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(Kitco News) - Gold prices are moderately up in midday U.S. trading Tuesday, after scoring another six-year high in overnight dealings. Safe-haven demand has been featured the past few sessions amid an escalating U.S.-China trade war. Bulls are in strong control and there are no early chart signals to suggest a market top is close at hand. December gold futures were last up $7.20 an ounce at 1,483.50. September Comex silver prices were last up $0.047 at $16.44 an ounce.

U.S. stock indexes recovered from follow-through early overnight losses and are solidly up at midday. Still, serious near-term technical damage has been inflicted on the U.S. stock indexes, to suggest they have put in at least near-term tops. Remember that the historically turbulent stock market months of September and October are right around the corner. This is a bullish scenario for gold and silver markets.

News late Monday that the U.S. labeled China a currency maninpulator initially pushed world stock markets still lower, following Monday’s steep losses. However, China’s central bank then set its currency, the yuan, exchange rate with the U.S. dollar at 6.9683, which was 0.7% down from Monday’s fixing. The yuan depreciated to an 11-year low against the U.S. dollar Monday, at 7.1087 to the dollar. The move on Monday led to ideas China has thrown in the towel on any trade agreement with the U.S. coming anytime soon. However, Tuesday’s yuan fixing below 7 gave pause to those thinking the Chinese government will let the yuan continue to depreciate against the U.S. dollar. Also, China’s central bank knows the downside of letting the yuan fall in value--one being flight of capital out of China, which has very likely already been occurring.

Many market watchers now reckon the U.S.-China trade war being ratcheted up another notch will prompt the Federal Reserve to again lower U.S. interest rates soon. Speeches by Federal Reserve officials in the coming days will garner extra scrutiny from the marketplace. St. Louis Fed

The key “outside markets” today see Nymex crude oil prices weaker at midday and trading around $54.50 a barrel. The U.S. dollar index is trading slightly firmer today.

Live 24 hours gold chart [Kitco Inc.]

Technically, December gold futures prices closed nearer the session high today. The bulls have the strong overall near-term technical advantage. A nine-week-old uptrend is in place on the daily bar chart. There are no early chart clues to suggest a market top is close at hand. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,500.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at last week’s low of $1,412.10. First resistance is seen at today’s high of $1,486.80 and then at $1,490.00. First support is seen at today’s low of $1,468.20 and then at $1,454.00. Wyckoff's Market Rating: 9.0

Live 24 hours silver chart [ Kitco Inc. ]

September silver futures prices closed near mid-range today. The silver bulls have the solid overall near-term technical advantage. A 10-week-old uptrend is in place on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at the July high of $16.685 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $15.625. First resistance is seen at this week’s high of $16.59 and then at $16.685. Next support is seen at this week’s low of $16.135 and then at $16.00. Wyckoff's Market Rating: 7.5.

September N.Y. copper closed up 145 points at 255.95 cents today. Prices closed nearer the session high on tepid short covering after hitting a 2.5-year low on Monday. The copper bears have the solid overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 268.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 250.00 cents. First resistance is seen at this week’s high of 257.80 cents and then at 260.00 cents. First support is seen at this week’s low of 253.15 cents and then at 252.00 cents. Wyckoff's Market Rating: 1.0.

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