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P.M. Kitco Metals Roundup: Gold Ends Weaker, Hits 7-Week Low; Yellen Remarks Benign

Tuesday February 24, 2015 1:47 PM

(Kitco News) - Gold prices ended the U.S. day session slightly lower and right about where the trading day began. Testimony from Fed Chair Janet Yellen in front of the U.S. Senate had no lasting effect on precious metals prices. The stronger U.S. dollar continues to be a bearish underlying factor working against the precious metals bulls. April Comex gold was last down $2.30 at $1,198.50 an ounce. May Comex silver last traded down $0.069 at $16.23 an ounce.

In Yellen’s testimony on monetary policy Tuesday she said the U.S. economy continues to improve and that at some point the Fed will likely raise interest rates. She said the decision on precisely when to make a monetary policy move will be on a meeting-to-meeting basis. Yellen had elements of her remarks that favored both the monetary policy hawks and doves, and ideas are mixed on whether she leaned one way or the other on policy, overall. All in all, there were no big surprises that came from Yellen’s testimony. Gold initially sold off modestly on Yellen’s comments, but that selling pressure subsided quickly. Yellen speaks to a U.S. House panel on Wednesday, but there is not likely to be anything significant, markets-wise, coming out of that event.

Reports Tuesday said Greece and European Union finance officials are in agreement on steps Greece needs to take on debt and economic reforms, in order to qualify for more EU financial aid. This matter continues to simmer down in the eyes of traders and investors…for now.

In other overnight news, the European Union got more downbeat news on the deflation front. Euro zone consumer prices fell in February at a record pace, since EU data began to be recorded in 1997. Eurostat said the bloc’s consumer prices fell 0.5% in January, year-on-year. The dour news prompted the Bank of England to say it stands ready to stimulate monetary policy if needed. The BOE had been on track to raise interest rates, many believed.

The London P.M. gold fix was $1,192.50 versus the previous A.M. fixing of $1,195.50.

Technically, April gold futures prices closed near mid-range today and hit another seven-week low. The gold bears have the solid overall near-term technical advantage. A five-week-old downtrend is in place on the daily bar chart. Bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,223.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at the January low of $1,168.30. First resistance is seen at today’s high of $1,204.40 and then at this week’s high of $1,210.30. First support is seen at today’s low of $1,190.00 and then at $1,185.00. Wyckoff’s Market Rating: 2.5

May silver futures prices closed near mid-range today and hit another seven-week low. Silver bears have the solid near-term technical advantage. A five-week-old downtrend is in place on the daily bar chart. 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 $16.00. First resistance is seen at today’s high of $16.505 and then at this week’s high of $16.635. Next support is seen at today’s low of $16.085 and then at $16.00. Wyckoff's Market Rating: 2.5.

May N.Y. copper closed up 500 points at 263.65 cents today. Prices closed nearer the session high today and hit a six-week high. The copper market bears still have the overall near-term technical advantage but the bulls gained upside momentum today, to begin to suggest that a market bottom is in place. A three-week-old uptrend is now in place on the daily bar chart. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 275.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 250.00 cents. First resistance is seen at today’s high of 266.80 cents and then at 270.00 cents. First support is seen at 260.00 cents and then at this week’s low of 256.10 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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