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Gold prices whipsawed on headline-driven day

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(Kitco News) - Gold prices are modestly up but way off daily highs in midday U.S. trading Thursday. Major headlines pushed gold prices sharply higher in the early going, but late-morning headlines dropped prices right back down. All-in-all, bulls won today’s news battle. December gold futures were last up $3.30 an ounce at 1,506.60. December Comex silver prices were last down $0.02 at $18.15 an ounce.

The early-morning release of the results of the monetary policy meeting of the European Central Bank saw the ECB act aggressively to ease its monetary policy--more than the marketplace expected. The ECB lowered interest rates by 0.1%, to minus 0.5%, and also announced a new “quantitative easing” bond-buying program, which is the largest in over three years. That news immediately pushed gold and silver prices sharply up and to daily highs, as traders reckoned other major central banks of the world would follow suit, including the Federal Reserve, whose FOMC meets next week.

However, gold and silver prices quickly dropped way off their session highs in late-morning dealings when newswire reports surfaced that the Trump administration may be seeking a resolution soon with China to end the trade war between the world’s two largest economies, including rolling back some of its trade tariffs on China.

Then, gold prices pushed back a bit higher when the Trump administration came out and denied the reports of any quicker resolution on trade with China.

Trader and investor risk appetite remains generally elevated late this week. That’s a negative for the safe-haven metals. The trade tensions between the U.S. and China still appear to have ratcheted down a notch this week. The U.S. did overnight announce the slight delay of implementation of some tariffs on China that were set to take effect October 1. This follows the move by China this week to exempt some U.S. products from their own tariffs. Both sides are set to hold talks in October. Reports today also said China is looking to narrow the scope of the negotiations to trade only—leaving out other matters that have been sticking points, such as national security.

The key “outside markets” today see Nymex crude oil prices lower and trading around $55.00 a barrel. Thursday sees a meeting of the OPEC oil cartel. The U.S. dollar index is lower in midday U.S. trading today, after posting solid gains early this morning.

Live 24 hours gold chart [Kitco Inc.]

Technically, December gold futures prices closed nearer the session low. The bulls have the firm overall near-term technical advantage and are keeping alive a three-month-old uptrend on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at the September high of $1,566.20. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,475.00. First resistance is seen at Tuesday’s high of $1,520.00 and then at $1,525.00. First support is seen at $1,500.00 and then at this week’s low of $1,492.10. Wyckoff's Market Rating: 7.0

Live 24 hours silver chart [ Kitco Inc. ]

December silver futures prices closed nearer the session low. The silver bulls have the overall near-term technical advantage. A three-month-old uptrend is still in place on the daily bar chart, but the bulls need to show fresh power soon to keep it alive. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $19.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $17.50. First resistance is seen at $18.40 and then at today’s high of $18.555. Next support is seen at $18.00 and then at this week’s low of $17.855. Wyckoff's Market Rating: 6.5.

December N.Y. copper closed up 325 points at 264.65 cents today. Prices closed nearer the session high, hit a six-week high and scored a bullish “outside day” up on the daily bar chart. The copper bears still have the overall near-term technical advantage. However, recent gains suggest this market has put in a bottom. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 275.00 cents. The next downside price objective for the bears is closing prices below solid technical support at the September low of 248.20 cents. First resistance is seen at today’s high of 266.80 cents and then at 268.00 cents. First support is seen at 262.00 cents and then at today’s low of 259.00 cents. Wyckoff's Market Rating: 4.0.

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