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P.M. Kitco Roundup: Gold Modestly Lower in Quiet Holiday Trading; Bears Have Technical Edge

Monday November 11, 2013 2:05 PM

(Kitco News) - Comex gold prices ended the U.S. day session modestly lower in quiet dealings Monday. Prices hit a three-week low overnight. The Armistice and Veterans Day holidays in Europe and the U.S. Monday squelched market activity. The U.S. government was closed on Monday and no U.S. economic data was released. December Comex gold was last down $2.10 at $1,282.50 an ounce. Spot gold was last quoted down $6.20 at $1283.75. December Comex silver last traded up $0.068 at $21.385 an ounce.

The market place on Monday was still digesting last Friday’s U.S. employment report for October, which showed a surprisingly larger-than-expected rise in non-farm payroll employment. The jobs report fell into the camp of U.S. monetary policy hawks who want to see the Fed start to “taper” its monetary policy sooner rather than later. That would be bearish for the raw commodity sector, including the precious metals. This week’s U.S. economic data will give traders and investors more guidance on the present health of the U.S. economy and just when the Fed might start to wind down its monthly bond-buying program. The next Federal Open Market Committee (FOMC) monetary policy meeting is held in December.

Last week’s U.S. economic data gave the U.S. dollar a boost against its other currency rivals. The U.S. dollar index hit a nearly two-month high last week but saw some profit taking-pressure Monday. The stronger greenback recently is a bearish underlying factor for the raw commodity sector. That sector continues to be in an overall bear market.

Reports Monday said China’s industrial production data, released during the weekend, showed a 10.3% rise in October, year-on-year. Consumer inflation in China was reported up 3.2% in October, on an annual basis. This economic data is an underlying bullish factor for the raw commodity sector, as it suggests the world’s second-largest economy and a voracious raw commodity importer is on a healthy economic growth path.

The London P.M. gold fix is $1,282.50 versus the previous P.M. fixing of $1,285.50.

Technically, December gold futures prices closed nearer the session low Monday and hit another fresh three-week low. The gold market bears have the near-term technical advantage. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the October high of $1,361.80. Bears' next near-term downside breakout price objective is closing prices below solid technical support at the October low of $1,251.00. First resistance is seen at Monday’s high of $1,288.80 and then at $1,300.00. First support is seen at Monday’s low of $1,278.10 and then at $1,270.00. Wyckoff’s Market Rating: 4.0

December silver futures prices closed near mid-range and poked to another fresh three-week low Monday. Silver bears now have the overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at the October high of $23.095 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at the October low of $20.495. First resistance is seen at $21.50 and then at Friday’s high of $21.905. Next support is seen at Monday’s low of $21.23 and then at $21.00. Wyckoff's Market Rating: 4.0.

December N.Y. copper prices closed near mid-range Monday. Bulls and bears are on a level near-term technical playing field amid choppy trading. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at the October high of 335.50 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the October low of 321.50 cents. First resistance is seen at Monday’s high of 327.60 cents and then at 330.00 cents. First support is seen at Monday’s low of 324.35 cents and then at last week’s low of 322.20 cents. Wyckoff's Market Rating: 5.0.

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By Jim Wyckoff, contributing to Kitco News; jwyckoff@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.
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