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P.M. Kitco Metals Roundup: Gold Prices End Mixed, Hovering Near 4-Year Low

Tuesday November 04, 2014 2:33 PM

(Kitco News) - Gold prices ended the U.S. day session narrowly mixed Tuesday—cash (spot) gold slightly higher while Comex futures prices were modestly lower. The gold bears remain in firm technical control as prices trade not far above the recent four-year low. The key “outside markets” remain in overall bearish postures for the precious metals—a stronger U.S. dollar and slumping crude oil prices. December Comex gold was last down $2.50 at $1,167.30 an ounce. Spot gold was last quoted up $1.80 at $1,167.50. December Comex silver last traded down $0.206 at $15.995 an ounce.

The “outside market” feature Tuesday was the drop in crude oil prices to a three-year low of $75.84, basis the nearby December Nymex futures contract. Combined with the appreciating value of the U.S. dollar, these two outside markets have been a major influence on other markets the past few weeks—and especially a negative force for the raw commodity sector, including gold and silver.

The other feature Tuesday was Japan’s Nikkei stock index hitting a seven-year high. The Nikkei has rallied over 7% since last Friday, in the aftermath of a new batch of monetary stimulus from the Bank of Japan. The Japanese yen has slumped against its world rivals following the BOJ move on Friday.

(Note: Follow me on Twitter--@jimwyckoff--for breaking market news.)

European stock markets were under selling pressure Tuesday following news the European Commission reported it expects European Union gross domestic product to rise by just 0.8% in 2014. That’s down from the 1.2% growth-rate forecast the agency issued in the spring. The Commission cited the Russia-Ukraine tensions as a major contributor to the slowing EU growth the past few months.

There are two big economic data points this week: the monthly meeting of the European Central Bank on Thursday and the U.S. employment situation report on Friday. Recent dour economic data coming out of the EU, and Japan’s fresh monetary stimulus last week, suggest the European Central Bank will move to enact more monetary stimulus sooner rather than later.

The London P.M. gold fix was $1,166.50 versus the previous London A.M. fixing of $1,169.25.

Technically, December gold futures prices closed near mid-range and closed at another fresh four-year low close today. The gold bears have the strong near-term technical advantage. The gold bulls’ next upside near-term price breakout objective is to produce a close above what is now solid technical resistance at $1,183.00. Bears' next near-term downside breakout price objective is closing prices below solid technical support at $1,150.00. First resistance is seen at today’s high of $1,175.00 and then at $1,180.00. First support is seen at last week’s low of $1,160.50 and then at $1,155.00. Wyckoff’s Market Rating: 1.0

December silver futures prices closed near mid-range. Prices today closed at a contract and four-year low close. The silver bears have the strong overall near-term technical advantage. Prices are in a four-month-old downtrend on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $17.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $15.00. First resistance is seen at this week’s high of $16.22 and then at Friday’s high of $16.515. Next support is seen at this week’s low of $15.74 and then at the contract low of $15.635. Wyckoff's Market Rating: 1.0.

December N.Y. copper closed down 465 points at 301.85 cents today. Prices closed nearer the session low today and scored a bearish “outside day” down on the daily bar chart. The bears have the near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 315.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 300.00 cents. First resistance is seen at 305.00 cents and then at today’s high of 307.35 cents. First support is seen at 300.00 cents and then at 298.00 cents. Wyckoff's Market Rating: 3.5.

By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com
Follow me on Twitter @jimwyckoff



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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