Gold and silver succumb to mild profit-taking pressure

 New York (Jun 8)  Gold and silver prices are modestly down in midday U.S. trading Tuesday, on some routine profit taking from the shorter-term futures traders. Still, the sellers are constrained by the still-bullish technical chart postures in place for both metals. However, the buyers of the safe-haven metals are tentative at present amid little risk aversion in the global market place. August gold futures were last down $4.40 at $1,893.20 and July Comex silver was last down $0.273 at $27.745 an ounce.

Global stock markets were mixed in quiet overnight trading. U.S. stock indexes are narrowly mixed at midday. Risk aversion in the marketplace is scant at present due in part to no major geopolitical developments in play. Such can change quickly, however.

Traders are awaiting the U.S. economic data point of the week, which will be Thursday morning’s consumer price index report for May, which is expected to come in at up 0.5% from April and up 4.7%, year-on-year. Traders and investors continue their buzz regarding the prospects for inflation to heat up to uncomfortable levels in the coming months. Rising raw commodity prices the past few months are an ominous sign that inflation could become problematic.

The key outside markets today see the U.S. dollar index slightly higher. Nymex crude oil prices are firmer and trading around $69.75 a barrel after hitting a 2.5-year high of $70.00 on Monday. Meantime, the yield on the benchmark 10-year U.S. Treasury note is presently fetching around 1.531%.

Technically, August gold futures bulls still have the firm overall near-term technical advantage. A nine-week-old price uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at the June high of $1,919.20. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,800.00. First resistance is seen at today’s high of $1,906.90 and then at $1,912.30. First support is seen at this week’s low of $1,883.70 and then at $1,866.70.

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