Comex gold prices ended sharply higher and at a record-high close Thursday, as inflationary pressures came to the forefront in the wake of Wednesday's fresh quantitative easing moves by the Federal Reserve. The U.S. dollar index came under more strong selling pressure Thursday, which also brought back keen investor buying interest in gold and silver. December Comex gold last traded up $42.90 at $1,380.50 an ounce. Spot gold was last quoted up $31.70 at $1,381.00.

Wednesday afternoon's Federal Reserve's FOMC statement initially roiled many markets, including precious metals. However, markets are digesting the Fed's move and appear to have come to the consensus that the U.S. government wants to continue to deflate its currency by printing dollars, which does raise the strong possibility of problematic inflationary pressures down the road. Investors worldwide also reckon the U.S. stimulus move by the Federal Reserve may have been unilateral and may serve to unsettle other major industrial nations at some point. This scenario is fully U.S. dollar bearish and gold/silver market bullish.

The U.S. dollar index traded solidly lower Thursday after setting a fresh 11-month low in late trading Wednesday. The dollar index remains technically and fundamentally very weak, which has been and continues to be bullish for the precious metals. The value of the U.S. dollar against the other major currencies will continue to be an important market factor for the precious metals. Any strong rebound in the U.S. dollar index in the near term would likely only be temporarily bearish for gold, to likely produce a significant downside near-term "correction" in an overall price uptrend. However, the gold market has enough strong fundamental and technical factors in its favor that even a sustained near-term rally in the U.S. dollar index is not likely to change the overall bullish posture of the gold market.

Traders are now awaiting Friday morning's U.S. jobs report. In the wake of the quantitative easing and Friday's employment report, how the precious metals markets close on Friday (near the weekly high or near the weekly low) could well set the tone for trading action into the end of the year. In other words, Friday will be an extra important trading day in many markets.

The London P.M. gold fixing was $1,381.00 versus the previous P.M. fixing of $1,345.50 an ounce.

Technically, December gold futures bulls have the solid overall near-term and longer-term technical advantage, and gained fresh upside power Thursday. A 13-week-old uptrend on the daily bar chart has been re-established this week. Bulls' next near-term upside technical objective is to produce a close above solid technical resistance at the all-time record high of $1,388.10. Bears' next near-term downside price objective is closing prices below solid technical support at $1,340.00. First resistance is seen at the all-time high of $1,388.10 and then at $1,400.00. Support is seen at $1,366.00 and then at $1,350.00. Wyckoff's Market Rating: 8.5.

December silver futures closed up 146.4 cents at $25.90 an ounce Thursday. Prices closed near the session high, hit a fresh 30-year high and also pushed above the $26.00 mark. The key "outside markets" were in a fully bullish posture for silver Thursday, as the U.S. dollar index was lower, while crude oil and the stock index futures were higher. Silver bulls have the solid overall near-term technical advantage. Prices are in a 13-week-old uptrend on the daily bar chart. The next downside price objective for the bears is closing prices below solid technical support at this week's low of $23.935. Bulls' next upside price objective is producing a close above solid technical resistance at $27.00 an ounce. First resistance is seen at Thursday's high of $26.10 and then at $26.25. Next support is seen at $25.50 and then at $25.00. Wyckoff's Market Rating: 9.0.

December N.Y. copper closed up 1,140 points at 389.90 cents Thursday. Prices closed near the session high and hit a fresh two-year high. The key "outside markets" were in a fully bullish posture for copper Thursday, as the U.S. dollar index was lower, while crude oil and the stock index futures were higher. The copper bulls have the solid overall near-term technical advantage. Prices are in a five-month-old uptrend on the daily bar chart. Bulls' next upside objective is pushing and closing prices above major psychological resistance at 400.00 cents. The next downside price objective for the bears is closing prices below solid technical support at last week's low of 370.35 cents. First resistance is seen at Thursday's high of 391.70 cents and then at 395.00 cents. First support is seen at 385.00 cents and then at Thursday's low of 381.25 cents. Wyckoff's Market Rating: 8.0.

By Jim Wyckoff of Kitco News; jwyckoff@kitco.com

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