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Gold Slightly Lower, Hits 7-Week Low; U.S. Jobs Data On Deck

(Kitco News) - Gold prices ended the U.S. day session slightly lower and fell to a seven-week low Thursday. The yellow metal is now hovering just above key psychological support at $1,100.00 heading into Friday morning’s important U.S. jobs report. December Comex gold was last down $1.40 at $1,104.70 an ounce. December Comex silver was last down $0.088 at $14.97 an ounce.

Traders and investors are awaiting Friday’s U.S. employment report from the Labor Department, which is arguably the most important data point of the week, if not the month. The key non-farm payrolls number is forecast to be up around 185,000 in October, following a rise of 142,000 jobs in September. Look for active trading in many markets in the immediate aftermath of the 8:30 a.m. EST report.

The marketplace on Thursday was still digesting some more hawkish “Fed speak,” as Federal Reserve Chair Janet Yellen on Wednesday told U.S. lawmakers that a U.S. interest rate hike in December is a “live possibility.” Her remarks followed a perceived hawkish FOMC statement that came out last week. More Fed officials were speaking Thursday, including Fed Vice Chair Stanley Fischer and New York Fed President William Dudley. Rightly or wrongly, the marketplace continues to be consumed by the precise timing of the next interest rate rise in the U.S.

The U.S. dollar index surged on the Yellen comments and on some upbeat U.S. economic data. The USDX hit a three-month high Thursday. The other key “outside market” saw Nymex crude oil prices trading weaker Thursday afternoon. Crude saw solid gains Tuesday, but has seen those gains given back.

In overnight news, the European Union said Euro zone economic growth in 2015 will be 1.6% versus a forecast of up 1.5% last spring. Inflation in the Euro zone is forecast at up 0.1% in 2015, which is unchanged from the spring forecast.

The Indian government is rolling out a new plan to monetize gold in the country. The World Gold Council says the move will bolster world confidence in gold as a reserve currency. The plan encourages India’s citizens to put gold in banks, which will pay them interest.

Technically, December gold futures prices closed nearer the session low and hit a seven-week low today. The gold bears have the firm overall near-term technical advantage. Prices are in a three-week-old downtrend on the daily bar chart. Bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,130.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at $1,100.00. First resistance is seen at today’s high of $1,111.30 and then at $1,120.00. First support is seen at today’s low of $1,103.60 and then at $1,100.00. Wyckoff’s Market Rating: 2.5

December silver futures prices closed near mid-range and hit another four-week low today. The silver market bears have the firm overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $16.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $14.50. First resistance is seen at $15.25 and then at this week’s high of $15.55. Next support is seen at today’s low of $14.91 and then at $14.75. Wyckoff's Market Rating: 2.5.

December N.Y. copper closed down 660 points at 225.70 cents today. Prices closed near the session low and hit a five-week low today. Copper bears have the solid overall near-term technical advantage. Prices are in a four-week-old downtrend on the daily bar chart. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at this week’s high of 236.20 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the August low of 220.25 cents. First resistance is seen at 230.00 cents and then at today’s high of 233.20 cents. First support is seen at today’s low of 225.15 cents and then at the September low of 222.55 cents. Wyckoff's Market Rating: 1.5.

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

 

 

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