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Gold Ends Near Steady; Buyers Timid as Crude Oil Prices Plunge

(Kitco News) - Gold prices ended the U.S. day session near unchanged levels Tuesday. Some late short covering in the futures market and bargain hunting in the cash market did lift prices up from their daily lows. Precious metals prices early this week are anchored by a downdraft in crude oil that saw Nymex futures Tuesday hit a nearly seven-year low below $37.00 a barrel. February Comex gold was last down $0.30 at $1,074.80 an ounce. March Comex silver was last down $0.192 at $14.14 an ounce.

Nymex crude oil prices did rebound well off the daily low by afternoon trading Tuesday.
The other key outside market saw the U.S. dollar index weaker on the day after trading firmer early on. Look for precious metals and other raw commodity market traders to continue to be influenced by the daily price actions in the crude oil market and the U.S. dollar index.

In overnight news, the Euro zone third-quarter gross domestic product rose by 0.3% from the second quarter and was up 1.6% year-on-year. The figures were in line with market expectations but also show the continued weak state of the Euro zone collective economy. The European Central Bank eased its monetary policy just last week but many look for further stimulus moves from the ECB in the near future.

In China, there was more downbeat economic news reported Tuesday. China’s exports were down 3.7%, year-on-year, while imports fell 5.6% in the same period. While the numbers were downbeat, they did beat forecasts for even worse readings.

Next week’s FOMC meeting is coming more into focus. The majority of market watchers believe the Federal Reserve will raise U.S. interest rates for the first time in nine years on December 16.

Technically, February gold futures prices closed nearer the session high. Bears have the solid overall near-term technical advantage and have regained some downside momentum this week. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,100.00. Bears' next near-term downside price breakout objective is pushing prices below solid longer-term technical support at last week’s contract low of 1,045.40. First resistance is seen at $1,080.50 and then at this week’s high of $1,086.10. First support is seen at this week’s low of $1,073.10 and then at $1,070.00. Wyckoff’s Market Rating: 2.0

March silver futures prices closed nearer the session low. The silver market bears have the firm overall near-term technical advantage and have regained downside momentum early this week. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $14.80 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the contract low of $13.805. First resistance is seen at today’s high of $14.31 and then at $14.50. Next support is seen at $14.00 and then at $13.805. Wyckoff's Market Rating: 2.0.

March N.Y. copper closed up 40 points at 205.50 cents today. Prices closed near mid-range. Copper bears have the firm overall near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 220.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 200.00 cents. First resistance is seen at today’s high of 207.40 cents and then at 210.00 cents. First support is seen at today’s low of 203.35 cents and then at last week’s low of 202.55 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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