Gold prices weakened Tuesday as the dollar rose on news that
Greece struck a deal
with global lenders to reduce its debt and get more loans to keep
the country on life support.
Spot gold prices slipped 0.42% to $1,743.00 an ounce.SPDR Gold
), tracking a 10th of an ounce of bullion, fell 0.39% to 168.77 a
share. It appears to be consolidating along its key 50-day moving
average, which is bullish. It's added 1.19% so far this
"Gold appears to be setting up another up thrust in the
short-term," Waverly Advisors of Corning, N.Y., wrote in a client
note Tuesday. The firm recommends setting a stop loss at $1,708 a
share on bullion, which translates to about $170.80 a share for
The latest resolutions to the Greek debt crisis involves
taking on more debt, loosening deficit limits, lowering interest
rates and central banks losing profits on their loans, which
pressure currency values, the firm stated.
"Inclusive of a bond buyback, the total notional amount
extended in December will exceed 34 billion euros," Waverly
Meanwhile, the Organization for Economic Cooperation and
Development forecast the European Union's economy will contract
1.4% in 2013. The OECD's report called for more easing from the
European Central Bank.
Ed Carlson, a chartered market technician and founder of
Seattle Technical Advisors, recommended in a note released Monday
that his clients buy gold on pullbacks between now and the second
week of December. His technical indicators suggest "gold broke
out of a two-week congestion zone on Friday." But he noted that
gold equities' weakness relative to the S&P 500 fails to
confirm the yellow metal's strength.
Market Vectors Gold Miners ETF (
) slipped 1.50% to 48.02. It regained its 200-day moving average
after breaking below it two weeks ago. But trading volume has
been very thin on the rebound, questioning the rebound's
strength. GDX has underperformed the market recently. It lost
9.57% so far this month, whileSPDR S&P 500 (
) shed a mere 0.54%.
Commodity sector mutual funds took in $1.7 billion -- the most
since Q2 of 2011 -- during the week ended Nov. 21. That's in
stark contrast to equity funds, which saw outflow of $7.74
billion, according to EPFR Global. Gold and precious metals
accounted for only a quarter of the total inflow into commodity
funds. Bond funds attracted $4.97 billion.
PowerShares DB U.S. Dollar Index Bullish (
), measuring the greenback against a basket of major foreign
currencies, added 0.25% to 22.00 in low volume, mostly because of
euro weakness. It appears to have found support at its 50-day
line. But its 50-day line has formed a bearish black cross by
crossing below the longer-term 200-day moving average, which is
Silver Prices Hold Strong
Silver futures gave back 0.50% to $34.11 an ounce.
IShares Silver Trust (
) eased 0.27% to 32.92. It's holding firm above the 50-day moving
average, which is very bullish. It's climbed 5.24% month to
Global X Silver Miners ETF (SIL) dropped 0.73% to 23.00. It's
consolidating below the 50-day line but above the 200-day line.
Its long-term direction remains up, but the short-term looks
trendless. It's fallen 9.17% so far in November.
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