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P.M. Kitco Metals Roundup: Gold Firmer on Tepid Upside Correction Following Heavy Losses Friday

Monday March 9, 2015 1:52 PM

(Kitco News) - Gold prices ended the U.S. day session slightly higher Monday, on a weak short-covering rebound and technical correction following Friday’s big losses that saw the market drop to a 13-week low. A stable U.S. dollar index on this day also encouraged a bit of bargain hunting in the gold and silver markets. April Comex gold was last up $2.90 at $1,167.20 an ounce. May Comex silver was last down $0.022 at $15.785 an ounce.

The market place on Monday was still digesting Friday’s stronger U.S. jobs report and its implications on U.S. monetary policy. Asian and European stock markets were mostly weaker in reaction to the U.S. jobs report on Friday, and the notions that report will prompt the Federal Reserve to raise interest rates sooner--as early as June. U.S. stock indexes did post mild rebounds following selling pressure Friday. The recent “risk-on” rallies in the U.S. stock indexes have been a bearish element for the competing asset, safe-haven gold.

The U.S. jobs report Friday and the specter of a tighter U.S. monetary policy trumped the beginning of the European Central Bank’s big bond-buying program Monday (quantitative easing).

European Union finance ministers met Monday to discuss whether to accept reform proposals from Greece, regarding its debt financing and repayment schedule. There were weekend reports that Greece’s financial situation is worse than most expected. Those reports also prompted just a bit of safe-haven buying interest in gold.

The key outside markets on Monday found the U.S. dollar index stable following big gains Friday that saw the index score an 11.5-year high. The Euro currency was also near steady after hitting an 11-year low on Friday. Crude oil prices were modestly higher by afternoon trading Monday.

U.S. economic data for released Monday was light and included the employment trends index, which had a negligible market impact.

The London P.M. gold fix was $1,168.50 versus the previous A.M. fixing of $1,173.75.

Technically, April gold futures prices closed nearer the session low today. Prices Friday dropped sharply and hit a 13-week low, including closing at a bearish weekly low close. A seven-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 $1,200.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at the December low of $1,143.40. First resistance is seen at today’s high of $1,174.40 and then at $1,180.00. First support is seen at Friday’s low of $1,162.90 and then at $1,150.00. Wyckoff’s Market Rating: 2.0

May silver futures prices closed nearer the session low and hit a nine-week low today. Silver bears have the solid near-term technical advantage. A seven-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 $16.79 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the January low of $15.57. First resistance is seen at $16.00 and then at $16.235. Next support is seen at today’s low of $15.705 and then at $15.57. Wyckoff's Market Rating: 2.0.

May N.Y. copper closed up 630 points at 267.20 cents today. Prices closed nearer the session high today and scored a bullish “outside day” up on the daily bar chart. Short covering and bargain hunting were featured. The copper market bears still have the overall near-term technical advantage. A four-week-old uptrend is in place on the daily bar chart, but the bulls need to show more power soon to keep it in place. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 280.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 255.00 cents. First resistance is seen at today’s high of 267.75 cents and then at last week’s high of 271.80 cents. First support is seen at 265.00 cents and then at 260.00 cents. Wyckoff's Market Rating: 3.0.

 

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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