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Gold, Silver See Profit-Taking Pullback, But No Chart Damage

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(Kitco News) - Gold and silver prices are lower in midday U.S. trading Thursday, on some normal profit taking from the shorter-term futures traders and on downside corrections after prices hit a six-year high in gold and a 13-month high in silver Wednesday. The global marketplace was calmer Thursday, following the keener anxiety seen among traders and investors on Wednesday. That allowed the world stock markets to rebound and bond yields to recover, pressure the safe-haven metals. December gold futures were last down $12.20 an ounce at 1,507.40. September Comex silver prices were last down $0.261 at $16.935 an ounce.

Some upbeat economic data coming out of China and the U.S. also aided the stock market bulls today. China’s exports rebounded in July, rising 3.3%, year-on-year, and compares to a 1.3% decline reported for June. China’s exports in July were expected down 2.0%. Meantime, China’s July imports were down 5.6%, year-on-year.

Importantly, Kitco readers should not conclude the fireworks in the marketplace have just quickly fizzled. Look for more volatility and uneasiness in the coming weeks, which should continue to benefit the gold and silver markets. Remember that the historically stock-market-turbulent months of September and October are around the corner.

China’s central bank on Thursday set its currency, the yuan, exchange rate with the U.S. dollar at 7.0039. That’s the weakest yuan fixing set by the central bank in 11 years, and is above the 7 level that the U.S. has ostensibly deemed problematic. This exchange rate will continue to be closely monitored. The U.S. designated China as a currency manipulator earlier this week.

The key “outside markets” today see Nymex crude oil prices solidly higher and trading around $52.50 a barrel. The U.S. dollar index is near steady in midday action.

Live 24 hours gold chart [Kitco Inc.]

Technically, December gold futures prices closed nearer the session low. The bulls still have the strong overall near-term technical advantage. A nine-week-old uptrend is in place on the daily bar chart. There are still 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 $1,550.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,467.00. First resistance is seen at this week’s high of $1,522.70 and then at $1,525.00. First support is seen at $1,500.00 and then at $1,490.00. Wyckoff's Market Rating: 8.5

Live 24 hours silver chart [ Kitco Inc. ]

September silver prices closed nearer the session low. The silver bulls still 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 $17.50 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 this week’s high of $17.145 and then at $17.25. Next support is seen at today’s low of $16.81 and then at $16.685. Wyckoff's Market Rating: 8.0.

September N.Y. copper closed up 385 points at 260.95 cents today. Prices closed nearer the session high on more short covering after hitting a 2.5-year low on Monday. The copper bears still 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 262.75 cents and then at 265.00 cents. First support is seen today’s low of 257.15 cents and then at at this week’s low of 253.15 cents. Wyckoff's Market Rating: 2.0.

 

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