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Gold pulls back as trader/investor confidence increasing

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(Kitco News) - Gold prices are trading solidly lower in midday U.S. trading Tuesday. Some profit taking from the shorter-term futures traders is featured again today. There is keener trader/investor risk appetite in the marketplace to start the U.S. trading week is also a negative for the safe-haven metals. Silver prices are faring well today, despite the pressure on gold. June gold futures were last down $27.20 an ounce at $1,708.30. July Comex silver prices were last down $0.068 at $17.624 an ounce.

Global stock markets were mostly higher today. U.S. stock indexes are solidly higher at midday. Traders and investors are upbeat early this week, following a long U.S. holiday weekend that saw more social interaction amid the unofficial start of summer. Such suggests quarantined people are gearing up to do more spending as businesses continue to reopen. Also, there is more hope following news of another Covid-19 vaccine that looks promising. Several drug companies are working at a fever pitch to develop a successful vaccine.

Still overshadowing the global marketplace is eroding U.S.-China relations. Barbs by both sides appear to have inflicted wounds too deep to just mask over. Some market watchers are predicting the U.S. and China will be the next major “cold war”—comparing the situation to the U.S.-Soviet Union stare-down that lasted decades.

China’s central bank this week has fixed its currency (the yuan) at a rate of 7.1293 to the U.S. dollar—the weakest in 12 years. Such is another move by Chinese officials that will not likely make the Trump administration happy. 

The important outside markets see the U.S. dollar index sharply down today. Nymex crude oil prices are firmer and trading around $33.50 a barrel. The big rebound in crude oil prices has surprised many oil analysts and is a big positive for stock, commodity and financial markets. The yield on the benchmark U.S. Treasury 10-year note is currently around 0.7%. 

Live 24 hours gold chart [Kitco Inc.]

Technically, June gold futures see no significant chart damage occurring recently but the bulls do need to step up and show fresh power soon to avoid some damage. The bulls still have the firm overall near-term technical advantage. Gold bulls' next upside near-term price objective is to produce a close above solid technical resistance at the April high of $1,788.80. Bears' next near-term downside price objective is pushing prices below solid technical support at $1,666.20. First resistance is seen at today’s high of $1,737.20 and then at $1,750.00. First support is seen at $1,700.00 and then at $1,683.00. Wyckoff's Market Rating: 7.0

Live 24 hours silver chart [ Kitco Inc. ]

July silver futures bulls have the firm overall near-term technical advantage. Silver bulls’ next upside price objective is closing prices above solid technical resistance at the February high of $19.07 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 $18.00 and then at the May high of $18.165. Next support is seen at today’s low of $17.37 and then at $17.19. Wyckoff's Market Rating: 7.0.

July N.Y. copper closed up 330 points at 241.95 cents today. Prices closed nearer the session high today. The copper bulls have the overall near-term technical advantage. Prices are in a nine=week-old uptrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 255.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 230.00 cents. First resistance is seen at today’s high of 243.90 cents and then at the May high of 246.80 cents. First support is seen at today’s low of 238.60 cents and then at 235.00 cents. Wyckoff's Market Rating: 6.5.

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.