Gold Modestly Up on Continued Good Physical Demand and Technical Buying...

www.cfb.ae

Comex gold futures prices ended the U.S. day session modestly higher Monday. The market found support from an improving near-term technical posture of the market. Recent good demand for physical gold continues to underpin the market. June Comex gold last traded up $4.20 at $1,468.40 an ounce. Spot gold was last quoted down $1.50 at $1,469.50.  July Comex silver last traded down $0.054 at $23.96 an ounce.

For the past couple weeks several analysts have been forecasting still-lower gold prices in the coming days and/or weeks based upon the past few months of outflows of investor money from exchange traded funds (ETFs). A report Monday said the largest gold ETF has now seen around a 20% loss in investor funds since the beginning of the year. While gold may or may not decline from present price levels, the price of gold will not decline in the coming weeks based upon an event that has already occurred. That’s not the way markets work. Markets very quickly digest and factor into their prices all known fundamental news.

 Now, if money continues to flow out of gold ETFs, that would be a bearish fundamental that could drive prices lower. However, the past few months of ETF’s money outflows have already been factored into the price of gold.

In overnight news, London was closed for a public holiday, which made for quieter dealings in the foreign exchange market. The European Union overall purchasing managers’ index declined in April, but by less than forecast by economists. However, the German economy, the largest in the EU, is showing weakness. The Market composite PMI for the EU came in at 46.9 in April from 46.5 in March. A reading below 50.0 shows contraction in business activity. Gold did receive a bit of supportive news from European Central Bank president Draghi, who Monday said the ECB could continue to ease its monetary policy if the EU economies show continued weakness.

Israeli missile strikes inside Syrian territory over the weekend have attracted the attention of the market place. Any escalation in that situation would likely prompt keener risk aversion in the world market place, and possibly fresh safe-haven demand for gold.

The U.S. dollar index was higher Monday, which did limit the upside in gold. The recent rebound in the greenback is a bearish underlying factor for the precious metals markets. Meantime, Nymex crude oil futures prices were slightly higher Monday. The crude oil bulls have regained upside near-term technical momentum as prices hit a four-week high overnight. That’s a bullish underlying factor for the precious metals.

Technically,  June gold futures prices closed near mid-range Monday. The bulls continue to show resilience, which suggests a near-term market bottom is in place. However, the bulls still have much work to do to suggest a near-term price uptrend can be sustained. Gold prices are still in a seven-month-old downtrend on the daily bar chart and the bears still have the overall technical advantage. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,500.00. Bears' next near-term downside breakout price objective is closing prices below solid technical support at last week’s low of $1,439.70. First resistance is seen at Monday’s high of $1,478.40 and then at last week’s high of $1,487.20. First support is seen at Monday’s low of $1,463.80 and then at Friday’s low of $1,455.40. Wyckoff’s Market Rating: 3.5
July silver futures prices closed nearer the session low Monday.

 Silver bears are still in overall technical control. Prices are in a seven-month-old downtrend on the daily bar chart. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $25.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $23.00. First resistance is seen at Monday’s high of $24.42 and then at last week’s high of $24.58. Next support is seen at Monday’s low of $23.82 and then at $23.62. Wyckoff's Market Rating: 3.5.

May N.Y. copper closed down 135 points at 330.00 cents Monday. Gold Price closed nearer the session low following Friday’s big gains that do suggest a market low is now in place. Copper bears still have the overall near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at the April high of 345.25 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 315.00 cents. First resistance is seen at Monday’s high of 332.40 cents and then at 335.00 cents. First support is seen at 328.20 cents and then at 325.00 cents. Wyckoff's Market Rating: 3.0.

Contact Us:

Asad Rasheed
Direct:04-3841906
Email:asad@cfb.ae
Email:info@cfb.ae

For more information please visit our website century financial brokers.

Here are some useful links that you can follow:

Here is a CFB blog that gives useful daily trade advice... http://century-financial-brokers-uae.blogspot.ae/

You can also follow CFB on facebook (useful advice on posts regularly)

Here is another blog that provides regular news and information and is very useful for Forex Signals. 

News Source: www.marketwatch.com