Gold - $1236.70 // $0.90 // 0.07%
Commentary: Thursday was a day of pause for gold, as the metal lost $2.45, or 0.20%. Gold ETF holdings increased to a new recent high near 66.6 million troy ounces, which is the highest level since mid-June, and only slightly below the all-time high near 66.8 million. Gold price advances from currently levels will likely be much more gradual as prices approach the all-time highs. Furthermore, as we have stated previously, in the event financial markets plunge from here, gold will likely get swept lower in the tide as traders liquidate the metal to raise cash.
Technical Outlook: Prices are testing horizontal resistance at $1,243.27, with a break past this boundary exposing the record high at $1,265.30. As we mentioned previously however, longer-term positioning reveals bearish cues with clear negative RSI divergence hinting that a major top may be taking shape. Confirmation of a downward reversal in line with our fundamental outlook requires a weekly close below a rising trend line set from the swing bottom in late 2008, now at $1,193.24.
Silver - $18.93 // $0.01 // 0.07%
Commentary: Silver eked out a $0.03, or 0.17% gain on Thursday, mimicking gold in its day of pause. The gold/silver ratio was little changed from yesterday and stands at 65.3, and close to the midpoint of the 2010 range of 60 to 71.
Technical Outlook: Prices have stalled ahead of resistance at $19.28 having resolved a descending triangle chart formation that had confined spot since mid-May with yesterday's sharp break to the upside. Near-term support lines up at $18.70.
Crude Oil (WTI) - $73.09 // $0.27 // 0.37%
Commentary: Crude oil advanced for a second session on Thursday, despite a down day for US equity markets. The commodity added $0.84, or 1.16%, and traded quite resiliently throughout the day. Oil was able to take advantage of the upward momentum established in the prior session, as there was no particular data or news that was responsible for the move. Currently, we are seeing crude oil down slightly as financial markets wait for the release of revised US GDP figures for the second quarter. The consensus expectation is for a 1.4% annualized reading, down sharply from the prior estimate of 2.4%. Economists have ratcheted down their estimates quite substantially in recent weeks following unfavorable trade data. With market expectations already low, it will be difficult for the number to surprise markets. Moreover, GDP data is backward looking, which obviously reduces their impact. While crude oil and equities will be affected by a large surprise in the GDP figure, markets will continue to be eminently concerned with the outlook for future economic growth and the potential for a double dip recession.
Technical Outlook: Prices continued higher after showing a piercing Line bullish reversal candlestick formation above support at $73.66, the 76.4% Fibonacci retracement of the 5/19-8/4 rally, with the bulls now testing the 61.8% Fib at $73.66. A move above this boundary exposes the lower boundary of a broken rising channel set from the May bottom (now at $75.89).
lya Spivak is currency strategist and and Sumit Roy is a researcher for DailyFX.