Gold Loses Early Gains Amid New Trade Worries, Recovery In USDX

(Kitco News) - Gold pricesare modestly down in early-afternoon trading, on some fresh concerns regardingthe U.S.-China trade war and a bounce in the U.S. dollar index up from itsdaily low. December gold futures were last down $2.40 an ounce at $1,208.50.December Comex silver was last down $0.048 at $14.24 an ounce.

Goldprices dropped from moderate early gains in late-morning dealings following atweet from President Trump that appeared to downplay any progress made on theU.S.-China trade dispute front. Gold saw some buying strength on Wednesday onreports the U.S. made an overture to China to restart the stalled trade talksbetween the world's two largest economies. It can be extrapolated that aU.S.-China trade agreement would be a benefit for precious metals markets dueto more demand coming from China because of its better economic strengthgarnered from a trade agreement.

Goldprices had seen gains in the wake of some morning U.S. economic data. TheAugust consumer price index came in at up 0.2% versus expectations of up 0.3%from July. The producer price index on Wednesday also came in lower thanexpected. The U.S. dollar index was pressured by the latest inflation report.

Todaythe European Central Bank met and left its monetary policy unchanged. The Bankof England also held its regular monetary policy meeting Thursday, and alsoleft interest rates unchanged.

Reportssaid the Turkish central bank raised its key interest rate by a whopping 6.25%today, in an effort to prop up its eroding currency, the lira. Traders andinvestors should continue to keep a close eye on the world's secondary currencymarkets.

Worldstock markets were mixed to mostly higher overnight. U.S. stock indexes are higherin midday trading and not far below record highs. The marketplace sees traderand investor attitudes remaining generally upbeat. That's bearish for thesafe-haven metals.

Theother key outside market today finds Nymex crude oil prices solidly lower onprofit taking and trading around $68.50 a barrel.

Technically,December gold futures bears still have the overall near-term technicaladvantage. However, prices are in a fledgling four-week-old uptrend on thedaily bar chart. Gold bulls' next upside near-term price breakout objective isto produce a close above solid technical resistance at $1,220.70. Bears' nextnear-term downside price breakout objective is pushing prices below solidtechnical support at the August low of $1,167.10. First resistance is seen attoday's high of $1,218.00 and then at $1,220.70. First support is seen at$1,200.00 and then at this week's low of $1,192.70. Wyckoff's Market Rating:3.0

Decembersilver futures bears have the solid overall near-term technical advantage.There are no early clues to suggest a market bottom is close at hand. Silverbulls' next upside price breakout objective is closing prices above solidtechnical resistance at $15.07 an ounce. The next downside price breakoutobjective for the bears is closing prices below solid support at $13.50. Firstresistance is seen at $14.405 and then at $14.59. Next support is seen at thisweek's low of $13.965 and then at $13.75. Wyckoff's Market Rating: 1.5.

DecemberN.Y. copper closed up 85 points at 268.45 cents today. Prices closed nearer thesession low today and saw more short covering. The copper bears still have thefirm overall near-term technical advantage. However, more good gains on Fridaywould begin to suggest a market bottom is in place. Copper bulls' next upsideprice objective is pushing and closing prices above solid technical resistanceat the August high of 283.80 cents. The next downside price objective for thebears is closing prices below solid technical support at the August low of257.45 cents. First resistance is seen at today's high of 271.75 cents and thenat 274.00 cents. First support is seen at 265.00 cents and then at 262.50cents. Wyckoff's Market Rating: 2.0.

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.

Mixed outlook for gold as it remains range bound for past three months

Gold stocks down on flat metal price

Gold stocks down on metal decline

Huge quantifiable rise in geopolitical, economic and trade risks

Platinum clearly ahead of palladium for first time in seven years