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P.M. Kitco Roundup: Gold Up, at 4-Week High, on Safe-Haven Demand and amid Weaker U.S. Dollar
Monday October 13, 2014 2:07 PM
(Kitco News) - Gold prices ended the U.S. day session moderately higher and hit a four-week high Monday. More safe-haven demand was featured amid the recent U.S. stock market sell-off. Short covering by the futures traders, whose bearish bets recently are not paying off, and bargain hunting in the cash market were also seen in gold to start the trading week. A lower U.S. dollar index was also a bullish “outside market” factor working in favor of the precious metals market bulls Monday. December Comex gold was last up $8.70 at $1,230.40 an ounce. Spot gold was last quoted up $7.20 at $1,230.75. December Comex silver last traded up $0.037 at $17.34 an ounce.
The U.S. government and U.S. Treasury markets were closed for the Columbus Day holiday Monday. There were also no major U.S. economic reports due for release. That made for a bit more subdued market place. The stock market bulls were hoping for and got a respite Monday, following late last week’s beat-down.
There was upbeat economic data coming out of China Monday. Import prices rose 7% in September, while exports were up 15% in the period. This is good news for raw commodity market bulls, as China is the world’s largest importer of raw commodities.
The U.S. dollar index was solidly lower Monday, as the greenback bulls are fading a bit after pushing prices to a four-year high last week. Meantime, Nymex crude oil futures were weaker Monday and hovering near last week’s two-year low. There are now cracks starting to develop in the OPEC oil cartel, as reports said member countries are offering discounts on their oil, to preserve their market share. I look for crude oil prices to continue their slide in the near term, including possibly pushing below $80.00 a barrel.
The London P.M. gold fix was $1,229.00 versus the previous London A.M. fixing of $1,228.00.
Technically, December gold futures prices closed near mid-range Monday. There are early technical clues a near-term market bottom is in place for gold. However, gold bears still have the overall near-term technical advantage. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,250.00. Bears' next near-term downside breakout price objective is closing prices below solid technical support at $1,200.00. First resistance is seen at Monday’s high of $1,238.00 and then at $1,242.00. First support is seen at Monday’s low of $1,223.60 and then at $1,217.60. Wyckoff’s Market Rating: 3.0
December silver futures prices closed nearer the session low Monday. The silver bears still have the firm overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $18.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the contract low of $16.64. First resistance is seen at last week’s high of $17.72 and then at $18.00. Next support is seen at $17.205 and then at $17.00. Wyckoff's Market Rating: 2.0.
December N.Y. copper closed up 120 points at 304.70 cents Monday. Prices closed near the session high and saw short covering. Copper bears still have the firm overall near-term technical advantage. Prices are in a choppy, 3.5-month-old downtrend on the daily bar chart. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 310.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the March low of 288.45 cents. First resistance is seen at last week’s high of 305.90 cents and then at 306.75 cents. First support is seen at Monday’s low of 302.10 cents and then at 300.00 cents. Wyckoff's Market Rating: 3.5.
By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com
Follow me on Twitter @jimwyckoff
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