Gold Price Weaker, No Reaction To As-Expected FOMC Statement

New York (JAug 1)  Gold and silver prices are weaker in early-afternoon U.S. trading Wednesday. The metals and other markets showed little reaction to the just-released FOCM statement that showed no change in U.S. monetary policy. December gold futures were last down $4.30 an ounce at $1,229.40. September Comex silver was last down $0.089 at $15.47 an ounce.

The FOMC meeting of the Federal Reserve that began Tuesday morning ended this afternoon with a statement saw no changes in interest rates or Fed policy and none were expected at this meeting. The statement guided the marketplace toward more gradual rate increases down the road, which is exactly what most expected to hear from the Fed. There was also no wording in the statement that caught traders off-guard.

The Bank of England meets Thursday for its regular monetary policy gathering. No changes in policy are expected from the BOE.

This morning’s ADP national employment report for July showed a rise of 219,000. The number is higher than the expected rise of 185,000. This number comes ahead of the more important U.S. non-farm payroll number on Friday, which is forecast to come in at up 190,000 in July. The metals markets reacted little to the ADP news.

The key “outside markets” today find Nymex crude oil prices lower and trading just around $67.50 a barrel. The U.S. dollar index is slightly higher today. These two markets are in a bearish daily posture for the precious metals markets.

Technically, the gold bears have the solid overall near-term technical advantage. There are still no strong, early clues to suggest a market bottom is close at hand.  A 3.5-month-old downtrend is in place on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,250.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,200.00.

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