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Gold Sees Modest Rebound; Upbeat U.S. Report Limits Advance

Kitco News

(Kitco News) - Gold Prices were ending the U.S. day session firmer Wednesday, on some mild short covering in the futures market and some perceived value-buying in the cash. Silver was near unchanged on the day. Both markets dropped to seven-week lows earlier this week. A weaker U.S. dollar index today was also somewhat supportive for the precious metals markets. December Comex gold was last up $2.40 an ounce at $1,277.00. December Comex silver prices were last down $0.005 at $16.655 an ounce.

Gold prices dipped to their daily lows in late-morning dealings Wednesday, following a surprisingly big rise in the September U.S. non-manufacturing purchasing managers' index (PMI), to 59.8 versus 55.3 in August. A September reading of 55.2 was expected. This report falls squarely into the camp of the U.S. monetary policy hawks, who want to see the Federal Reserve raise interest rates in December.

The U.S. ADP national employment report for September was released this morning and showed a gain of 135,000 jobs. This was below the median forecast for a rise of 150,000. The precious metals markets did not show significant reactions to the news.

Traders and investors are looking ahead to Friday’s U.S. employment report for September from the Labor Department. The key non-farm payrolls number is expected to come in at up only 80,000, according to a Dow Jones Newswires survey. The unusually low non-farm jobs growth estimate is due to two major hurricanes that hit the U.S. mainland in September.

Fed Chair Janet Yellen gives a speech Wednesday afternoon. Any comments she makes on the U.S. economy will be closely scrutinized for clues on the timing of future monetary policy moves by the Federal Reserve.

The U.S. dollar index was weaker in early afternoon trading, but well off its daily low, on a corrective pullback after hitting a six-week high on Tuesday.

The other key outside market on Wednesday saw Nymex crude oil futures weaker. While the oil bulls still have the slight overall near-term technical advantage, there are stiff chart resistance layers above the market, to suggest a near-term market top is in place.

Live 24 hours gold chart [Kitco Inc.]

Technically, December gold futures prices closed nearer the session low. Bears have the overall near-term technical advantage. A steep three-week-old downtrend is in place on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,300.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,250.00. First resistance is seen at today’s high of $1,285.00 and then at $1,290.00. First support is seen at this week’s low of $1,271.00 and then at $1,265.00. Wyckoff's Market Rating: 4.0

Live 24 hours silver chart [ Kitco Inc. ]

December silver futures prices closed nearer the session low and hit a seven-week low today. The silver bears have the overall near-term technical advantage. Prices are in a three-week-old downtrend on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at last week’s high of $17.295 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 $16.92 and then at $17.00. Next support is seen at $16.50 and then at $16.25. Wyckoff's Market Rating: 4.0.

December N.Y. copper closed down 50 points at 295.85 cents today. Prices closed near mid-range today. The copper bulls have the overall near-term technical advantage, but trading has been choppy recently. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the September high of 317.85 cents. The next downside price objective for the bears is closing prices below solid technical support at 280.00 cents. First resistance is seen at 300.00 cents and then at 302.50 cents. First support is seen at this week’s low of 292.60 cents and then at the September low of 289.40 cents. Wyckoff's Market Rating: 6.0.

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 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.