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P.M. Kitco Metals Roundup: Comex Gold, Silver End Lower on Crude Oil Weakness, Technical Selling

(Kitco News) - Comex gold and silver futures prices finished the day session in New York lower on a sharp sell off in crude oil futures prices. Technically related selling was also featured as both gold and silver prices fell below some key near-term support levels. August gold last traded down $10.20 an ounce at $1,519.00. Spot gold last traded down $13.90 an ounce at $1,518.75. July Comex silver last traded down $01.302 at $30.025 an ounce.

Precious metals prices started the U.S. session under mild to modest selling pressure, but saw losses extended near midday when crude oil prices fell to their daily lows. Crude oil bulls are fading badly amid reports Saudi Arabia will begin pumping more crude oil in July. Weaker U.S. and China economic data recently is a major bearish fundamental that is pressuring the crude oil market. Overall, crude oil prices remain trapped in a wide, sideways trading range, but are now in the bottom portion of that range. Crude oil has been and will continue to be a leader in the raw commodity market sector.

There is some key economic data coming out of China early this week, and that will be closely watched by the market place. More weak Chinese data would be a bearish factor for the commodity markets, including the precious metals.

The U.S. dollar index traded slightly lower Monday. However, the index on Friday did post a bullish weekly high close as the bulls did gain a bit a fresh upside technical momentum, but need to show more power early this week to keep it. A weakening Euro currency as the European Union's debt problems are back on the front burner are pressure the Euro and supporting the U.S. dollar index. Any significant deterioration in the EU sovereign debt situation would be U.S. dollar-bullish. Reports say there is still no final IMF/EU/Greece agreement in place for dealing with Greece's sovereign debt problems.

The London P.M. gold fixing $1,526.25 versus the previous P.M. fixing of $1,529.25.

Technically, August Comex gold futures prices closed nearer the session low Monday and hit a fresh three-week low. Prices also dropped below solid near-term technical support at $1,520.40 to produce some fresh near-term chart damage. Gold bulls do till have the overall near-term and longer-term technical advantage, but have faded and need to show fresh power soon to avoid more serious near-term technical damage being inflicted. Prices are still in a 4.5-month-old uptrend on the daily bar chart and in a 10-year-old uptrend on the longer-term monthly chart. Bulls' next near-term upside technical objective is to produce a close above solid technical resistance at the June high of $1,555.00. Bears' next near-term downside price objective is closing prices below psychological support at $1,500.00. First resistance is seen at $1,520.40 and then at $1,525.00. First support is seen at Monday's low of $1,511.40 and then at $1,500.00. Wyckoff's Market Rating: 6.5.

July silver futures prices closed nearer the session low Monday. Prices also dropped below key near-term technical support at the June low of $35.065 to produce some fresh near-term technical damage. Silver bulls still have the slight overall near-term technical advantage, but have faded and need to show fresh power soon to keep that advantage. The next downside price breakout objective for the bears is closing prices below solid technical support at the May low of $32.30. Bulls' next upside price objective is producing a close above solid technical resistance at last week's high of $37.86 an ounce. First resistance is seen at $35.00 and then at $35.50. Next support is seen at Monday's low of $34.55 and then at $34.00. Wyckoff's Market Rating: 5.5.

July N.Y. copper closed down 300 points at 403.00 cents Monday. Prices closed near mid-range. Weaker crude oil prices helped to pressure copper today. A four-week-old uptrend on the daily bar chart has been penetrated on the downside and negated recently. Bulls are fading. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at the May high of 426.70 cents. The next downside price breakout objective for the bears is closing prices below major psychological support at 400.00 cents. First resistance is seen at Monday's high of 406.00 cents and then at 410.00 cents. First support is seen at Monday's low of 401.00 cents and then at 400.00 cents. Wyckoff's Market Rating: 4.5.

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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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