Gold sees some promising profits after recent gains

 Gold and silver prices are trading weaker in midday dealings, with gold seeing some normal profit-taking pressure from recent good gains. A rally in the U.S. dollar index today is also a negative for the metals markets. The gold market bulls have gained the slight near-term technical advantage. More anxiety in the marketplace early this week has added some support to the precious metals markets, on safe-haven demand. October gold futures were last down $4.70 at $1,782.90 and September Comex silver was last down $0.146 at $23.645 an ounce.

Today’s U.S. retail sales report for July came in down 1.1% from June versus an expected decline of 0.3%. The markets showed little reaction to the news, but traders are wondering if the larger-than-expected decline in retail sales in July was due to worries about the resurgence of the Covid virus.

Global stock markets were mostly lower overnight. The U.S. stock indexes are solidly lower at midday. Risk-off attitudes are on the rise early this week. The stunningly rapid takeover of Afghanistan by the Taliban has left Americans stranded in the country and its own population running scared. This is the biggest crisis yet for the Biden Administration that was caught completely off-guard by the situation in Afghanistan.

Also, the surging Covid delta virus is starting to impact major economies, including and especially China. The U.S. is also seeing a rapid rise in cases. Traders and investors remember too well the masks and lockdowns that crippled economies just one year ago.

The marketplace is also focusing on the Federal Reserve possibly and even likely tightening its monetary policy as soon as this fall. A town hall speech by Fed Chairman Powell to educators and students today will be very closely parsed. Next week’s annual Jackson Hole Fed symposium is likely to see clarification on the Fed’s monetary policy and the timing of any upcoming actions by the central bank.

The key outside markets today see the U.S. dollar index solidly up. Nymex crude oil futures prices are lower and trading around $66.70 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching 1.23%.

Technically, gold bulls have gained the slight overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $1,800.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $1,700.00. First resistance is seen at today’s high of $1,795.00 and then at $1,800.00. First support is seen at Monday’s low of $1,769.80 and then at $1,760.00. Wyckoff’s Market Rating: 5.5

The silver bears have the firm overall near-term technical advantage. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $25.00 an ounce. The next downside price objective for the bears is closing prices below solid support at the August low of $22.295. First resistance is seen at $24.00 and then at $24.38. Next support is seen at Monday’s low of $23.38 and then at $23.00. Wyckoff’s Market Rating: 3.0.

September N.Y. copper closed down 1,190 points at 420.80 cents today. Prices closed near the session low and hit a four-week low today. The copper bulls have lost their overall near-term technical advantage. Copper bulls’ next upside price objective is pushing and closing prices above solid technical resistance at 450.00 cents. The next downside price objective for the bears is closing prices below solid technical support at the June low of 409.40 cents. First resistance is seen at 425.00 cents and then at 430.00 cents. First support is seen at 420.00 cents and then at the July low of 416.65 cents. Wyckoff’s Market Rating: 5.0.

By Jim Wyckoff

For Kitco News