Gold, silver see corrections in solid price uptrends

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(Kitco News) Gold and silver prices are lower and near their daily lows in midday U.S. trading Thursday, on some corrective action in overall price uptrends. More routine profit taking from the shorter-term futures traders was featured today after recent good gains. Silver prices overnight did poke to another 11-month high and are closing in on $20. August gold futures were last down $14.20 an ounce at $1,799.00. September Comex silver prices were last down $0.206 at $19.56 an ounce. 

Some mostly upbeat U.S. economic data Thursday, including a better-than-expected rise in June retail sales, added a bit of selling pressure in the precious metals markets.

The European Central Bank today left its monetary policy unchanged, as expected.

Global stock markets were mostly lower Thursday. The U.S. stock indexes are down at midday. There are growing worries the surge in Covid-19 reported infections worldwide, including in the U.S., will force economies to be locked down again. U.S. markets are likely to be impacted by a very busy day of economic reports and earnings releases.

China became the first major economy to come out of contraction when it on Thursday reported better-than-expected second-quarter GDP at up 3.2% versus -6.8% in the first quarter, year-on-year. A 2.4% rise was forecast for the second quarter. China’s industrial production rose 4.8% in June versus up 4.4% in May. However, China’s retail sales in June were reported at -1.8% versus -2.8% in May. Despite the generally upbeat news, China’s main stock index, the Shanghai composite, fell by 4.5% and the sharpest drop since February.

The important outside markets today see Nymex crude oil prices weaker and trading around $40.80 a barrel. The U.S. dollar index is slightly firmer after hitting a five-week low Wednesday. The yield on the benchmark U.S. Treasury 10-year note is currently around the 0.62% level. 

Technically, the gold bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close in August futures above solid resistance at $1,850.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at last week’s low of $1,779.20. First resistance is seen at this week’s high of $1,819.50 and then at $1,825.50. First support is seen at this week’s low of $1,791.10 and then at $1,779.00. Wyckoff’s Market Rating: 8.0

September silver futures bulls have the solid overall near-term technical advantage. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $20.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $18.00. First resistance is seen at the overnight high of $19.87 and then at $20.00. Next support is seen at $19.24 and then at this week’s low of $19.08. Wyckoff’s Market Rating: 8.0.