(Kitco News) - Gold prices are modestly lower in early U.S. trading Thursday, pressured by a solid rebound in the U.S. dollar index and some upbeat U.S. economic data. December gold was last down $4.90 at $1,664.30 and December silver was down $0.031 at $19.455.
The U.S. data point of the day saw the first estimate for third-quarter gross domestic product come in at up 2.6%, year-on-year. GDP was forecast to come in up 2.3%, year-on-year. The personal consumption expenditures (PCE) price index came in at up 4.2% and was lower than expected. The PCE index is said to be closely watched by the Federal Reserve as a gauge of inflation. The U.S. dollar index was further boosted on the GDP data, after posting overnight gains.
The latest monetary policy meeting of the European Central Bank Thursday saw the ECB raise its main interest rate by another 0.75%--the same as at the last meeting. The rate now stands at 1.50%. The Euro currency sold off on the news. U.S. interest rates are still well above those of the Euro zone.
Global stock markets were mixed overnight. U.S. stock indexes are headed for mixed openings when the New York day session begins. The U.S. indexes have seen solid rebounds from their October lows. Stock traders are closely watching corporate earnings reports. The technology sector results have been generally disappointing.
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| Support for gold should hold at $1,600 - Standard Charter's Suki Copper |
In other news, the troubled Credit Suisse bank announced a major overhaul that includes cost reductions and raising cash from outside investors.
The key outside markets today see the U.S. dollar index higher. There are early technical clues that begin to suggest the USDX has put in a major top. Nymex crude oil prices are slightly up and trading around $87.00 a barrel. The 10-year U.S. Treasury note is yielding 4.061%.
Other U.S. economic data due for release Thursday includes the weekly jobless claims report, durable goods orders and the Kansas City Fed manufacturing survey.
![Live 24 hours gold chart [Kitco Inc.]](/images/live/gold.gif?0.2924175530478188){kind=small}
Technically, the gold futures bears have the firm overall near-term technical advantage. However, more upside price action in the near term would form a bullish double-bottom reversal pattern that would suggest a major market bottom is in place. Bulls’ next upside price objective is to produce a close above solid resistance at $1,700.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,600.00. First resistance is seen at this week’s high of $1,679.40 and then at $1,700.00. First support is seen at Wednesday’s low of $1,653.80 and then at this week’s low of $1,641.20. Wyckoff's Market Rating: 2.5
![Live 24 hours silver chart [ Kitco Inc. ]](/images/live/silver.gif)
The silver bears have the overall near-term technical advantage. However, recent price action suggests a market bottom is in place. Silver bulls' next upside price objective is closing prices above solid technical resistance at the October high of $21.31. The next downside price objective for the bears is closing prices below solid support at the September low of $17.40. First resistance is seen at this week’s high of $19.765 and then at $20.00. Next support is seen at Wednesday’s low of $19.18 and then at $19.00. Wyckoff's Market Rating: 3.5.
