P.M. Kitco Metals Roundup: Comex Gold Ends Sharply Lower on Uptick in Investor Risk Appetite, Technically Related Selling
(Kitco News) - Comex December gold futures prices finished the U.S. day session sharply lower. It was a "risk on" day in the world market place Thursday, as world stock markets were firmer and appear to have stabilized this week. That's bearish for the safe-haven investment asset gold. Investors and traders at are viewing, at least temporarily, the European Union debt crisis as de-escalating. Some technical support levels were also breached on the downside in December gold Thursday, to set off sell stops and push gold prices still lower. December gold last traded down $43.20 at $1,783.30 an ounce. Spot gold last traded down $40.80 an ounce at $1,780.75. December Comex silver last traded down $0.958 at $39.575 an ounce.
This week may have seen investors and traders turn the corner on the European Union sovereign debt crisis front. On Wednesday Moody's downgraded two major French banks' credit ratings. But the markets showed little reaction. That's a clue that the market place has probably factored in all the bad news coming out of and expected to come out of the EU. Worries were also eased when a conference call between the leaders of Greece, Germany and France Wednesday resulted in all three leaders pledging to keep Greece afloat in the EU. Then on Thursday morning five major central banks of the world, including the Federal Reserve and European Central Bank, announced they were adding liquidity into the European financial system by injecting U.S. dollars into it. The apparent de-escalation in the EU debt crisis worked to put downside price pressure on safe-haven gold.
The U.S. dollar index traded lower Thursday, in part due to the news of the central banks injecting greenbacks into the European financial system. The Euro currency saw a solid a rebound on that move and on the easing EU debt tensions.
Crude oil futures prices traded firmer Thursday. Crude oil bulls have gained a bit of fresh upside momentum this week as prices Wednesday hit a fresh five-week high. Crude oil will remain an important "outside market" that will influence the precious metals markets.
The London P.M. gold fixing was $1,782.00 versus the previous P.M. fixing of $1,818.50.
Technically, December gold futures prices closed nearer the session low Thursday and hit a fresh three-week low. Sell stops were triggered after technical support levels were breached on the downside Thursday. However,
no serious chart damage was inflicted. But the bulls do not want to see follow-through selling pressure on Friday to produce a bearish weekly low close and raise the specter of a bearish double-top reversal pattern forming on the daily bar chart. At present, the gold market bulls still have the overall technical advantage. Bulls' next upside technical objective is to produce a close above solid technical resistance at this week's high of $1,865.20. Bears' next near-term downside price objective is closing prices below solid technical support at $1,750.00. First resistance is seen at $1,800.00 and then at Thursday's high of 1,829.70. First support is seen at Thursday's low of $1,775.00 and then at $1,750.00. Wyckoff's Market Rating: 7.5.
December silver futures prices closed nearer the session low Thursday and hit a fresh three-week low. The silver bulls still have the overall near-term technical advantage, but did fade today and do not want to see a bearish weekly low close on Friday. A 10-week-old uptrend on the daily bar chart was at least temporarily negated today. Bulls' next upside price objective is producing a close above strong technical resistance at this week's high of $41.60 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $38.81. First resistance is seen at $40.00 and then at $40.50. Next support is seen at Thursday's low of $39.40 and then at $39.00. Wyckoff's Market Rating: 5.5.
December N.Y. copper closed up 615 points 395.95 cents Thursday. Prices closed nearer the session high on short covering in a bear market. Copper bears have the overall near-term technical advantage, amid choppy trading. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 410.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the August low of 384.20 cents. First resistance is seen at Thursday's high of 398.00 cents and then at 400.00 cents. First support is seen at 392.50 cents and then at 390.00 cents. Wyckoff's Market Rating: 4.0.
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By Jim Wyckoff, contributing to Kitco News; email@example.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.