Gold Hits 5-Mo. Low Amid Little Risk Aversion, Powerful Greenback

(Kitco News) - Gold prices areslightly down, and up from the daily lows, in early-afternoon dealings Monday.The yellow metal dropped to a five-month low in early U.S. action. Upbeatinvestor risk appetite in the world marketplace continues to work against thesafe-haven metals. Also, the U.S. dollar index continues to appreciate, to thechagrin of the precious metals market bulls. The U.S. dollar index scored asix-month high today. June Comex gold futures were last down $2.20 an ounce at$1,289.10. July Comex silver was last up $0.055 at $16.51 an ounce.

Someshort covering in the futures market and bargain hunting in the cash market didlift gold up from the stronger losses seen in U.S. and overnight trading. Thegold market is now short-term oversold on a technical basis, and due for acorrective bounce very soon.

Worldstock markets were higher today and U.S. stock indexes were solidly higher inmidday New York day trading, to underscore the upbeat trader and investor riskattitudes at present.

Also,the world marketplace has been put a bit more at ease by news the U.S. andChina have agreed to set aside their trade dispute and not slap tariffs on eachother’s goods, for now. U.S. Treasury Secretary Mnuchin made that announcementover the weekend.

Europeantraders and investors are still nervous regarding the potential for Italy’santi-establishment parties to form a government, and then pulling out of theEuropean Union. Such has caused the yield spread between German and Italiangovernment bonds to widen substantially.

Theother key “outside market” today finds Nymex crude oil prices trading higherand above $72.00 a barrel. The rallying oil market is a bullish element for theprecious metals that is at least limiting the downside for them.

Technically,gold prices are in a two-month-old downtrend on the daily bar chart. The goldbears have the overall near-term technical advantage. Gold bulls' next upsidenear-term price breakout objective is to produce a close above solid technicalresistance at $1,300.00. Bears' next near-term downside price breakoutobjective is pushing prices below solid technical support at the December lowof $1,247.20. First resistance is seen at $1,294.00 and then at $1,300.00.First support is seen at today’s low of $1,281.20 and then at $1,275.00.Wyckoff's Market Rating: 3.5

Silverprices scored a mildly bullish “outside day” up on the daily bar chart. Shortcovering was featured. The silver bears have the overall near-term technicaladvantage. Silver bulls' next upside price breakout objective is closing pricesabove solid technical resistance at the May high of $16.865 an ounce. The nextdownside price breakout objective for the bears is closing prices below solidsupport at the May low of $16.07. First resistance is seen at $16.565 and thenat $16.75. Next support is seen at today’s low of $16.28 and then at lastweek’s low of $16.19. Wyckoff's Market Rating: 3.0.

JulyN.Y. copper closed up 320 points at 309.55 cents today. Prices closed nearerthe session high today. The copper bulls and bears are on a level overallnear-term technical playing field amid recent choppy trading. Copper bulls'next upside price objective is pushing and closing prices above solid technicalresistance at the April high of 321.80 cents. The next downside price objectivefor the bears is closing prices below solid technical support at the March lowof 295.85 cents. First resistance is seen at today’s high of 311.15 cents andthen at the May high of 313.10 cents. First support is seen at today’s low of306.50 cents and then at 305.00 cents. Wyckoff's Market Rating: 5.0.

By Jim Wyckoff

For Kitco News

Follow @jimwyckoffjwyckoff@kitco.comwww.kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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