A.M. Kitco Metals Roundup: Gold Steady, Near 2-Month High As Bulls Have Some Technical Momentum

(Kitco News) - Comex gold futures prices are near unchanged but did hit a two-month high in early U.S. trading Monday. The bulls have gained upside technical momentum to suggest prices can trade sideways to higher in the near term. December gold was last up $1.60 at $1,372.70 an ounce. Spot gold was last quoted down $3.40 at $1,374.25. September Comex silver last traded down $0.067 at $23.25 an ounce.
The “dog days” of summer are upon the market place to start the new trading week, as conditions are mostly calmer and quieter. The exception is the sharp drop in the Indian Rupee currency overnight. The Rupee has been on a sharp downslide recently, which has the world market place paying attention but not yet overly concerned.
Traders and investors are still watching the Egypt unrest, which was violent over the weekend. Any escalation in violence is likely to impact the market place, and could prompt a rise in demand for safe-haven assets, including gold.
Of importance to the entire market place is the continued rise in government bond yields worldwide, with the U.S. 10-year note fetching 2.87% and the German 10-year bund yield at 1.91% on Monday. Both rates are the highest in well over a year. The rising bond yields are an early clue that problematic inflation could creep back into the major world economies at some point down the road.
The U.S. dollar index is slightly lower Monday morning. The greenback bears still have the overall near-term chart advantage. Nymex crude oil futures prices are weaker Monday morning, supported on the Egypt unrest. The crude oil bulls have the solid overall near-term technical advantage.
There is no major U.S. economic data due for release Monday.
The London A.M. gold fix is $1,375.25 versus the previous London P.M. fixing of $1,369.25.
Technically, December gold futures prices hit a two-month high overnight. Gold bears still have the slight overall near-term technical advantage, but the bulls have made good headway recently. Last week’s price action established a seven-week-old uptrend on the daily bar chart. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,400.00. Bears' next near-term downside breakout price objective is closing prices below solid technical support at $1,300.00. First resistance is seen at the overnight high of $1,384.10 and then at $1,390.00. First support is seen at the overnight low of $1,369.00 and then at Friday’s low of $1,357.00.
September silver futures prices hit a three-month high overnight. Bulls have solid upside technical momentum and have the near-term technical advantage. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $24.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $22.00. First resistance is seen at the overnight high of $23.605 and then at $24.00. Next support is seen at the overnight low of $23.04 and then at Friday’s low of $22.755.
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By Jim Wyckoff

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