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A.M. Kitco Metals Roundup: Comex Gold Surges to New All-Time High, then Backs Off; Bulls Still Powerful

(Kitco News) - Comex December gold futures are trading higher in early U.S. trading Tuesday, but have backed well down from the overnight all-time record high of $1,923.70. It's presently "risk off" in the market place as the U.S. stock indexes are trading lower and U.S. Treasuries are higher Tuesday, as the European Union's sovereign debt crisis is back on the front burner of the market place. Worries about a worldwide economic recession setting in are also bullish for safe-haven gold Tuesday. December gold last traded up $14.70 at $1,891.70 an ounce. Spot gold last traded down $11.30 an ounce at $1,889.50. December Comex silver last traded down $1.069 at $42.00 an ounce. Gold prices soared to a new record in early trading Tuesday as the European Union debt crisis continues to fester. There have been ongoing negotiations among EU leaders, with the underlying theme that there is still not uniform agreement on specific near-term actions to be taken. Italy is the focus early this week, with Italian bond yields rising amid talk of worker strikes about to occur there. European stocks markets were under pressure Monday on this situation, as the U.S. markets were closed for a holiday. U.S. markets are playing catch up Tuesday. The surprising news overnight that the Swiss National Bank announced it will peg the Swiss franc to the value of the Euro currency did coincide with gold prices backing well off the record high scored in earlier trading Tuesday. The uncertainty of that situation or the big down move in the Swiss franc may have prompted skittishness in the gold market, or produced some margin-related selling in gold. The U.S. dollar index is trading firmer Monday and prices hit a fresh four-week high overnight. More short covering was featured in the dollar index. While the greenback bears still have the overall near-term technical advantage, bulls now have some fresh upside near-term technical momentum to begin to suggest a near-term market low is in place. However, fundamentally, notions of a fresh U.S. monetary stimulus package from the Federal Reserve in the coming weeks or few months will likely limit the upside for the dollar index. The U.S. and European stock markets will continue to be the key gauge of worldwide investor risk appetite in the market place. On days of better investor risk appetite (higher stocks) buying interest in gold will likely be limited. On days of shrinking investor risk appetite (lower stocks) gold will likely see more buying interest. U.S. economic data due for release Monday includes the employment trends index and the ISM non-manufacturing report. The London A.M. gold fixing was $1,891.00 versus the previous P.M. fixing of $1,895.00. Technically, December gold futures bulls' have regained solid upside momentum, and their next near-term upside technical objective is to produce a close above major psychological resistance at $2,000.00. Bears' next near-term downside price objective is closing prices solid technical support at $1,817.60. First resistance is seen at $1,900.00 and then at the August high of $1,917.90 and then at the overnight all-time high of $1,923.70. First support is seen at $1,887.40 and then at $1,875.00. December silver futures bulls have the overall near-term technical advantage even though prices are under some profit-taking pressure Tuesday. Prices are in a choppy, two-month-old uptrend on the daily bar chart. Bulls' next upside price objective is producing a close above strong technical resistance at the August high of $44.295 an ounce. The next downside price breakout objective for the bears is closing prices below psychological support at $40.00. First resistance is seen at $42.50 and then at $43.00. Next support is seen at the overnight low of $41.715 and then at $41.50. Follow me on Twitter to immediately get the very latest market developments. If you are not on board, then you are not getting key analysis and perspective as fast or as often as you could! Follow me on Twitter to get my very timely intra-day and after-hours briefs on precious metals price action. The precious markets will remain very active. If you want market analysis fast, and in after-hours trading, then follow my up-to-the-second precious metals market perspective on Twitter. It's free, too. My account is @jimwyckoff . By Jim Wyckoff contributing to Kitco News; jim@jimwyckoff.com

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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