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A.M. Kitco Metals Roundup: Comex Gold Weaker, Silver Higher Early; Fresh Economic Data Awaited

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(Kitco News) - Comex gold is slightly lower and silver futures are higher in quieter early trading Thursday. Traders are awaiting the latest European Central Bank meeting conclusion and press conference, and the weekly U.S. jobless claims report for direction. August gold last traded down $2.30 an ounce at $1,536.40. Spot gold last traded down $2.10 an ounce at $1,536.00. July Comex silver last traded up $0.40 at $37.02 an ounce.

This morning's European Central Bank (ECB) meeting results, and the ECB press conference to follow, will be very closely monitored by the market place. It's not expected the ECB will raise interest rates Thursday, but it has been speculated the ECB will hint that it will raise rates in July. Recent European Union economic data has been stronger and the U.S. data has been weaker. If such continues to be the case, it would be a bearish development for the U.S. dollar and bullish for the Euro currency--which would also be bullish for the precious metals. The currency markets could be more active today, and that could spill over into other markets such as metals and the U.S. stock indexes.

The U.S. dollar index is trading slightly lower Thursday. The greenback is likely to see more selling pressure in the near term amid the better economic data coming out of the European Union at the same time weak data comes out of the U.S. The one factor that could work to support the U.S. dollar and pressure the Euro currency in the near term would be a significant deterioration in the EU sovereign debt situation that EU and IMF officials are working hard to contain.

Crude oil prices are trading higher early Thursday, on follow-through strength from solid gains Wednesday in the wake of the surprise news that OPEC would not raise its collective crude oil production quota. Overall, crude oil prices remain trapped in a wide, sideways trading range. Crude oil has been and will continue to be a leader in the raw commodity market sector.

U.S. economic data due for release Thursday includes the weekly jobless claims report, the international trade report and wholesale trade inventories.

The London A.M. gold fixing is $1,534.00 versus the previous P.M. fixing of $1,537.75.

Technically, August Comex gold futures bulls still have the solid overall near-term and longer-term technical advantage. The very recent downside, corrective and profit-taking pressure is not surprising, following recent gains. A four-month-old uptrend is in place on the daily bar chart and a 10-year-old uptrend is in place on the longer-term monthly chart. Bulls' next near-term upside technical objective is to produce a close above solid technical resistance at the all-time high of $1,577.70. Bears' next near-term downside price objective is closing prices below solid technical support at last week's low of $1,520.40. First resistance is seen at the overnight high of $1,539.80 and then at Wednesday's high of $1,547.40. First support is seen at the overnight low of $1,534.00 and then at this week's low of $1,531.80.

July Comex silver futures bulls have the overall near-term and longer-term technical advantage, even though prices have been trading in a choppy and sideways fashion for several weeks. The next downside price breakout objective for the bears is closing prices below solid technical support at last week's low of $35.065. Bulls' next upside price objective is producing a close above solid technical resistance at $38.845 an ounce. First resistance is seen at this week's high of $37.52 and then at $38.00. Next support is seen at the overnight low of $36.56 and then at $36.00.

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By Jim Wyckoff of Kitco News; jwyckoff@kitco.com

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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