Gold Price Down Amid Bearish "Outside Market" Forces
New York (June 20) Gold prices ended the day with modest losses and hit another four-week low Tuesday. Some mild short-covering in the futures market and bargain hunting in the cash market seen early in the session gave way to the sellers later in the day, who were emboldened by falling crude oil prices and a rebound in the U.S. dollar. August Comex gold was last down $2.60 an ounce at $1,244.10. July Comex silver was last down $0.072 at $16.43 an ounce.
The key “outside markets” on Tuesday saw Nymex crude oil futures prices trade solidly lower and hit a seven-month low. The oil market bears have the solid overall near-term technical advantage as prices traded below $43.00 a barrel today. There continue to be notions of a worldwide oil supply glut that will continue to depress prices for some time to come.
Meantime, the U.S. dollar index was firmer today on some short covering and continuing growing notions of a more hawkish Federal Reserve. The greenback bears still hold the overall near-term technical advantage, but the dollar index appears to have stabilized from recent selling pressure.
The world geopolitical front has seen just a bit of turbulence this week. A U.S. citizen held captive in North Korea for over a year and just returned home has died. A U.S. warplane shot down a Syrian jet, which has prompted a stern rebuke from Russia. While potentially market-sensitive at some point soon, these events have so far had very little impact on the world marketplace.
Several Federal Reserve officials speak this week and the marketplace will closely scrutinize their comments for any clues on the future direction of U.S. monetary policy.
A speech on U.S. tax reform by U.S. House of Representatives Speaker Paul Ryan that just concluded had very little if any impact on markets prices.
Live 24 hours gold chart [Kitco Inc.]
August gold futures prices closed near mid-range. The gold bulls and bears are now on a level overall near-term technical playing field. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,275.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,225.00. First resistance is seen at $1,250.00 and then at this week’s high of $1,257.30.
Source: KitcoNews
