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P.M. Kitco Metals Roundup: Comex Gold Ends Lower on Consolidation, Weak Raw Commodity Sector Tuesday
Tuesday July 31, 2012 1:52 PM
Comex gold futures prices ended the U.S. day session moderately lower amid general weakness in the raw commodity sector Tuesday. Some chart consolidation was also seen following recent price gains that took gold prices to a fresh six-week high late last week. The market place is also subdued ahead of some key central bank meetings this week, and the U.S. jobs report on Friday. December gold last traded down $7.00 at $1,617.00 an ounce. Spot gold was last quoted down $8.10 an ounce at $1,614.80. September Comex silver last traded down $0.113 at $27.92 an ounce.
Focus of the market place this week is on the two-day FOMC meeting of the U.S. Federal Reserve, which started Tuesday morning and ends Wednesday afternoon, and the European Central Bank’s policy meeting and press conference on Thursday. The Bank of England also meets to discuss its monetary policy, with results on Thursday. Market watchers will be closely scrutinizing these central bank meetings for any fresh clues on the implementation of quantitative easing of monetary policies. The ECB is expected by many to announce a fresh monetary stimulus package. Such would be at least initially bullish for many markets, including the precious metals.
After the batch of central bank meetings are out of the way, focus of the market place will quickly turn to the U.S. employment report on Friday morning.
In overnight news, there was more downbeat EU economic data released, as the unemployment rate in the EU rose to above 11%--its highest level since EU record-keeping began in 1995.
Tuesday is the last trading day of the month, which makes it a more important day from a technical standpoint.
With the month of August just around the corner, much of Europe is set to go on holiday, which means the market place will have fewer players the next few weeks. Such could make for quite, choppy and range-bound trading for many markets, including the precious metals.
The U.S. dollar index was weaker Tuesday, while crude oil prices were sharply lower to lead a sell-off in the raw commodity sector.
The London P.M. gold fix is $1,622.00 versus the previous London P.M. fixing of $1,617.75.
Technically, December gold futures prices closed nearer the session low Tuesday and scored a mildly bearish “outside day” down on the daily chart—whereby the high is higher and low is lower than the previous day’s session, with a lower close. The gold market bulls and bears are on a level near-term technical playing field as bulls and bears struggle for near-term control. The gold bulls’ next upside price breakout objective is to produce a close above solid technical resistance at the June high of $1,646.40. Bears' next near-term downside price objective is closing prices below psychological support at $1,600.00. First resistance is seen at $1,625.00 and then at last week’s high of $1,633.30. First support is seen at Tuesday’s low of $1,614.20 and then at Friday’s low of $1,604.90. Wyckoff’s Market Rating: 5.0
September silver futures prices closed nearer the session low Tuesday after hitting another fresh four-week high early on. Silver bulls have gained a bit of fresh upside near-term technical momentum recently. Silver bears do still have the slight overall near-term technical advantage, however. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at the July high of $28.445 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at last week’s low of $26.575. First resistance is seen at Tuesday’s high of $28.335 and then at $28.445. Next support is seen at Tuesday’s low of $27.865 and then at this week’s low of $27.515. Wyckoff's Market Rating: 4.5.
September N.Y. copper closed up 30 points 341.90 cents Tuesday. Prices closed nearer the session low. Copper bulls and bears are presently on a near-term level technical playing field. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at the July high of 355.65 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at last week’s low of 333.20 cents. First resistance is seen at Tuesday’s high of 345.70 cents and then at 347.50 cents. First support is seen at this week’s low of 340.25 cents and then at Friday’s low of 337.90 cents. Wyckoff's Market Rating: 5.0.
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By Jim Wyckoff,
contributing to Kitco News; jwyckoff@kitco.com
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