Gold Sees Corrective Pullback After Recent Good Gains

(Kitco News) - Gold prices aremodestly lower on a normal downside technical correction after hitting a seven-weekhigh Tuesday. Prices are still within striking distance of the key $1,300.00mark. Major news events lie just ahead that are likely to move the preciousmetals markets. August Comex gold was last down $5.40 an ounce at $1,292.10.JulyComex silver was last down $0.10 at $17.61 an ounce.

Terror attacksin Iran Wednesday, including on its parliament, have not had a significantimpact on the world marketplace. ISIS has claimed responsibility for theattacks.

Important andlikely markets-moving events are on tap late this week. On Thursday there aregeneral elections in the U.K., a European Central Bank meeting, and former FBIdirector James Comey testifies to the U.S. Congress. That should make for anactive and potentially volatile day in many markets. Next week, the FederalReserve's FOMC meets, at which time it is expected the Fed will slightly raiseU.S. interest rates.

There is also abit of uneasiness in the marketplace about the Trump administration thatcontinues to be embroiled in controversy, particularly regarding alleged tiesto the Trump team and the Russian government involving the presidentialelection in 2016. The Wall Street Journal on Tuesday ran a scathing editorialon Trump's leadership style.

The key outsidemarkets on Wednesday morning see the U.S. dollar index is higher on acorrective and short covering rebound after hitting a six-month low Tuesday.The greenback bears are still in firm near-term technical control as dollarindex prices are in a three-month-old downtrend. The other "outside market" onWednesday morning sees Nymex crude oil futures prices slightly lower. The oilmarket bears have the firm overall near-term technical advantage as prices arebelow $50.00 a barrel. These two markets are in a bearish daily posture for theprecious metals.

U.S. economicdata due for release Wednesday includes the weekly MBA mortgage applicationssurvey, consumer installment credit and the weekly DOE liquid energy stockssurvey.

(Note: Followme on Twitter--@jimwyckoff--for breaking market news.)

Technically, Augustgold futures bulls have the firm overall near-term technical advantage as prices are in an uptrend onthe daily bar chart. Bulls' next upside near-term price breakout objective isto produce a close above solid technical resistance at $1,300.00. Bears' nextnear-term downside price breakout objective is closing prices below solidtechnical support at $1,260.00. First resistance is seen at $1,300.00 and thenat $1,310.00. First support is seen at this week's low of $1,280.20 and then at$1,275.00. Wyckoff's Market Rating: 7.0

Julysilver priceshit a five-week high Tuesday. Bulls have the overall near-term technicaladvantage. The next upsideprice breakout objective is closing futures prices above solid technicalresistance at $18.00 an ounce. The next downside price breakout objective forthe bears is closing prices below solid support at $16.75. First resistance isseen at this week's high of $17.745 and then at $18.00. Next support is seen atthis week's low of $17.495 and then at $17.25. Wyckoff's MarketRating: 6.0.

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 precious metal products, 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.

Bullish bankers and bearish institutions split on gold forecasts

Gold stocks down on flat metal price and mixed equities

Snowline Gold reports Initial Resource Estimate

Inflation subsiding and rate cuts starting internationally

Inflation rebound continues to reverse