Gold Sees Some Follow-Through Strength

(Kitco News)- Gold and silver prices are modestly up in early-afternoon U.S. trading Monday. Somefollow-through buying interest from Friday's solid gains and a lower U.S.dollar index on this day worked in favor of the precious metals market bulls.However, with the world marketplace quieter to start the trading week and withlittle risk aversion among traders and investors, gains in the safe-havenmetals were limited. December gold futures were last up $3.10 an ounce at$1,216.40. December Comex silver was last up $0.059 at $14.965 an ounce.

U.S.stock indexes are solidly higher and set new record highs today, underscoringthe keener risk appetite that is in the marketplace at present. However, goldand silver bulls are wondering if the historically turbulent months ofSeptember and October that are now right around the corner will provide someupside potential.

Asianmarkets were supported overnight by moves by China's central bank to stabilizeits currency, the yuan. The yuan in recent weeks had depreciated against theU.S. dollar.

Thekey outside markets today find the U.S. dollar index lower as the bulls are nowfading a bit. Meantime, Nymex crude oil prices are slightly up and trading justbelow $69.00 a barrel.

Technically,gold bears still have the overall near-term technical advantage but a pricedowntrend on the daily bar chart is now in jeopardy. Gold bulls' next upsidenear-term price breakout objective is to produce a close in December futures above solid resistance at $1,226.00. Bears' next near-term downside pricebreakout objective is pushing prices below solid technical support at theAugust low of $1,167.10. First resistance is seen at last week's high of$1,215.40 and then at $1,220.00. First support is seen at today's low of$1,209.30 and then at $1,200.00. Wyckoff's Market Rating: 2.5

December silver futures bears have the overallnear-term technical advantage. Silver bulls' next upside price breakoutobjective is closing prices above solid technical resistance at $15.50 anounce. The next downside price breakout objective for the bears is closingprices below solid support at $14.00. First resistance is seen at last week'shigh of $14.965 and then at $15.00. Next support is seen at last week's low of$14.555 and then at the August low of $14.405. Wyckoff's Market Rating: 2.5.

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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