Gold Sees Tepid Short Covering, Bargain Hunting; Bears May Now Be Exhausted
Comex gold futures prices are near steady but down from the early high Monday morning, Kitco News reported.
It said some mild short covering and bargain hunting are featured following recent strong selling pressure that Friday saw prices hit a 4.5-month low. "Importantly, Friday's price action in gold could be an early technical clue the gold market bears have run out of gas. Prices spiked sharply lower early on Friday, but by the end of the trading session prices had rebounded well up from the daily low, to produce a selling 'exhaustion tail' on the daily bar chart, whereby the sellers became exhausted at the lower price levels and prices then drifted back higher. A close in prices nearer the session high on Monday would be an early technical clue that gold prices on Friday did mark a near-term bottom."
February gold traded up US$0.40 an ounce at $1,649.60. Spot gold was quoted down $7.40 at $1,650.00. March Comex silver traded up $0.149 at $30.09 an ounce.
According to Kitco News, it's a relatively quiet start to the new trading week and the U.S. economic docket is light Monday. "The shine of last week's temporary U.S. fiscal cliff agreement by U.S. lawmakers has quickly faded. The market place is now looking forward with trepidation to the upcoming negotiations between the U.S. Congress and the Obama administration on budget and spending matters. Such is likely to limit trader and investor participation in many markets in the coming weeks."
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