(Kitco News) – Gold prices have popped higher in the immediate aftermath of a downbeat U.S. retail sales report that lands on the side of the U.S. monetary policy doves, who don’t want the Federal Reserve to further raise interest rates any time soon. If the gold market can close at a technically bullish weekly high close today (Friday), such would be an early chart clue that a market bottom is in place. August Comex gold was last up $10.70 an ounce at $1,228.10. September Comex silver was last up $0.209 at $15.89 an ounce.
June retail sales were reported down 0.2% from May. A reading of up 0.1% was expected. Meantime, the June consumer price indexcame in at unchanged from May, while a number of up 0.1% was expected. Both of these reports suggest the Fed can be in no hurry to increase interest rates any time soon. Such a scenario would be a bullish underlying element for the precious metals markets. The easy money policies of the world’s central banks over much of the past decade have supported most raw commodity market prices.
The “outside markets” on Friday morning see Nymex crude oil futures firmer and trading above $46.00 a barrel. The oil market bulls have had a good week. A technically bullish weekly high close in Nymex crude oil Friday would suggest a market bottom is in place.
Meantime, the U.S. dollar index is lower early today, pressured by the weak U.S. economic data. The greenback bears have the firm near-term technical advantage amid a solid price downtrend.
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Technically, August gold futures bears still have the overall near-term technical advantage as prices are in a five-week-old downtrend on the daily bar chart. However, a bullish weekly high close today would suggest a market bottom is in place. Bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,240.00. Bears’ next near-term downside price breakout objective is closing prices below solid technical support at $1,200.00. First resistance is seen at today’s high of $1,229.70 and then at $1,235.00. First support is seen at $1,220.00 and then at today’s low of $1,214.00. Wyckoff’s Market Rating: 3.5
September silver bears still have the firm overall near-term technical advantage. The next upside price breakout objective is closing futures prices above solid technical resistance at $16.50 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $15.00. First resistance is seen at $16.00 and then at $16.25. Next support is seen at the overnight low of $15.575 and then at $15.25. Wyckoff’s Market Rating: 2.0.