A.M. Kitco Metals Roundup: Comex Gold Lower amid “Risk-Off” Trading Day, Firmer U.S. Dollar Index
Comex gold futures prices are trading lower Wednesday morning as investor risk appetite has shrunk a bit due to fresh worries coming out of the European Union. The key “outside markets” are also in a bearish daily posture for the precious metals Wednesday, as the U.S. dollar index is higher and crude oil prices are weaker. June gold last traded down $10.00 at $1,652.50 an ounce. Spot gold was last quoted down $11.10 an ounce at $1,651.50. July Comex silver last traded down $0.30 at $30.63 an ounce.
The European Union debt and financial worries are back on the front burner of the market place Wednesday as the matter was temporarily put on the back burner Tuesday because most of Europe was on holiday. There was a very weak European Union manufacturing report released overnight that has added a negative tone to the raw commodity markets, including the precious metals. Many now believe the EU bloc has slipped back into economic recession.
The U.S. dollar index is trading higher Wednesday on short covering and some fresh safe-haven buying interest amid the EU worries. Dollar index prices Tuesday hit a two-month low. Meantime, crude oil futures prices are trading modestly lower Wednesday morning. However, crude oil bulls still have some upside near-term technical momentum on their side.
Gold and silver traders will see how the market place reacts to Wednesday morning’s U.S. ADP national employment report, which could be a market-mover. However, the big U.S. economic report for the week and arguably for the month comes on Friday with the U.S. employment report.
U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the ADP national employment report, the U.S. Treasury quarterly refunding announcement, and manufacturers’ shipments and inventories.
The London A.M. gold fixing is $1,652.50 versus the previous London P.M. fixing of $1,664.00.
Technically, June gold futures bulls and bears are still on a level near-term technical playing field. Importantly, the longer-term price trend for gold remains up, as it has for the past 11 years. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the April high of $1,685.40. Bears’ next near-term downside price objective is closing prices below technical support at the April low of $1,613.00. First resistance is seen at the overnight high of $1,663.90 and then at $1,675.00. First support is seen at the overnight low of $1,649.10 and then at this week’s low of $1,645.10.
July silver futures are still in a two-month-old downtrend on the daily bar chart. The silver bears still have the near-term technical advantage. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $32.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at the April low of $29.99. First resistance is seen at the overnight high of $31.06 and then at this week’s high of $31.445. Next support is seen at the overnight low of $30.505 and then at Monday’s low of $29.99.