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P.M. Kitco Metals Roundup: Comex Gold Ends With Solid Gains as Trading Turns Choppy Oil

(Kitco News) - Comex December gold futures prices ended the U.S. day session with good gains Tuesday, as trading has turned choppy on the charts recently. Safe-haven and bargain hunting buying interest were featured, following Monday's selling pressure and amid ongoing European Union debt concerns. Gold bulls also continue to be encouraged by the overall bullish technical posture of the yellow metal. December gold last traded up $28.10 an ounce at $1,807.10 an ounce. Spot gold last traded up $27.20 an ounce at $1,806.25. December Comex silver last traded up $0.867 at $40.03 an ounce.

Traders are focusing upon the two-day meeting of the U.S. Federal Open Market Committee, which began Tuesday. The market place expects the FOMC to announce some fresh monetary stimulus measure. Many believe the Fed will implement a so-called "twist" move, which is an effort to keep longer-term U.S. interest rates at very low levels. Such a move by the Fed would be gold and commodity-market bullish, as it would not only make the returns on hard assets more appealing, but it would also likely put downside price pressure on the U.S. dollar index.

The European Union sovereign debt situation has simmered down just a bit the past couple days, as it looks like Greece will get its latest loan package that will get it by for the next few months. Italy did get its credit rating downgraded by Standard & Poors overnight, but that move was not surprising and markets showed little reaction to it. The EU debt situation remains a bullish underlying factor for gold, even though it's likely that the present bad situation regarding EU debt has likely been mostly factored into market prices.

The U.S. dollar index traded slightly lower Tuesday and that is an underlying bullish factor for gold. Still, the dollar index bulls have the near-term technical advantage following recent gains.

Crude oil futures prices were firmer Tuesday, on a corrective bounce following Monday's selling pressure, and that's also bullish for gold.

Crude oil bulls still have some upside momentum. Crude oil will remain an important "outside market" that will influence the precious metals markets.

The London P.M. gold fixing was $1,799.00 versus the previous P.M. fixing of $1,794.00.

Technically, December gold futures prices closed nearer the session high Tuesday. Trading has turned very choppy. This type of "backing and filling" action on the charts is not surprising. The gold market bulls still have the overall near-term and longer-term technical advantage. Bulls' next upside technical objective is to produce a close above solid technical resistance at last week's high of $1,865.20. Bears' next near-term downside price objective is closing prices below solid technical support at last week's low of $1,765.40. First resistance is seen at Tuesday's high of $1,814.30 and then at 1,825.00. First support is seen at $1,800.00 and then at $1,775.00. Wyckoff's Market Rating: 7.5.

December silver futures prices closed nearer the session high Tuesday. The silver bulls have the overall near-term technical advantage. The key "outside markets" were mildly bullish for silver Tuesday as the U.S. dollar index was slightly lower while crude oil prices were modestly higher. Silver bulls' next upside price objective is producing a close above strong technical resistance at last 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 today's high of $40.375 and then at this week's high of $40.90. Next support is seen at $39.50 and then at Tuesday's low of $39.23. Wyckoff's Market Rating: 6.0.

December N.Y. copper closed down 555 points 372.55 cents Tuesday. Prices closed near the session low and hit another fresh 9.5-month low. Serious near-term chart damage has occurred recently. Copper bears have the solid overall near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at this week's high of 391.50 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at November 2010 low of 355.00 cents. First resistance is seen at 375.00 cents and then at 377.50 cents. First support is seen at Tuesday's low of 372.35 cents and then at 370.00 cents. Wyckoff's Market Rating: 2.5.

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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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