(Kitco News) – Gold prices are near steady in early U.S. trading Monday, on a normal pause and some corrective consolidation after prices last Friday scored a six-year high. Silver prices are posting solid gains today, after that metal hit a 13-month peak on Friday. August gold futures were last down $0.40 an ounce at 1,426.30. September Comex silver prices were last up $0.205 at $16.40 an ounce.
Gold and silver bulls are in the driver’s seat at mid-summer, and a pause in near-term price uptrends would not be surprising this week.
Asian and European stocks were mixed overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session beings. The U.S. indexes hit record and contract highs last week.
Geopolitical tensions are higher to start the trading week, on news that Iran’s military late Friday seized a British oil tanker near the Strait of Hormuz, apparently in response to the U.K. capturing an Iranian vessel a couple weeks ago. Iran’s confrontation with the U.S. and the U.K. will probably escalate in the coming weeks, with the concern in the marketplace being a major U.S. military strike against Iran, which could disrupt oil shipping in the Persian Gulf. Such would be bullish for the safe-haven metals.
Focus of traders and investors remains on the major central banks of the world and their lean toward more accommodative monetary policies amid worries about slowing global economic growth. The European Central Bank holds its regular monetary policy meeting on Thursday. Next week, the U.S. Federal Reserve’s Open Market Committee (FOMC) has its money policy meeting. Both central banks are expected to ease their monetary policies at the meetings. That’s also a bullish scenario for the metals.
The key “outside markets” today see Nymex crude oil prices higher and trading around $56.50 a barrel. Meantime, the U.S. dollar index is slightly higher today.
U.S. economic data due for release Monday is light and includes the Chicago Fed national activity index.
Technically, the gold bulls have the solid overall near-term technical advantage. A two-month-old uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close in August futures above solid resistance at $1,500.00. Bears’ next near-term downside price breakout objective is pushing August futures prices below solid technical support at $1,400.00. First resistance is seen at today’s high of $1,430.80 and then at $1,442.00. First support is seen at $1,420.00 and then at $1,410.00. Wyckoff’s Market Rating: 7.5
September silver futures bulls have the solid overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $17.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $15.625. First resistance is seen at today’s high of $16.455 and then at $16.50. Next support is seen at the overnight low of $16.195 and then at $16.00. Wyckoff’s Market Rating: 7.5.
By Jim Wyckoff
For Kitco News