Comex gold prices ended the U.S. day session near steady Thursday. There was some more profit-taking pressure and chart consolidation after prices on Wednesday hit a 6.5-month high. The stronger U.S. dollar index Thursday did limit buying interest in many commodity markets, including the precious metals. December gold last traded down $1.20 at $1,770.50 an ounce. Spot gold was last quoted down $1.50 an ounce at $1,768.75. December Comex silver last traded up $0.107 at $34.69 an ounce.
The much-anticipated HSBC China manufacturing PMI was released Thursday and came in at a reading of 47.8 in the latest month, which was the eleventh straight month of contraction in China’s manufacturing sector. Asian stock markets fell on the China news, while raw commodity markets, including gold and silver, also saw some selling pressure due to the weak China data. The market place is also uneasy regarding a serious territorial dispute between China and Japan regarding ownership of a small chain of islands.
A closely watched Spanish government debt auction went off well Thursday amid good investor demand. The recent pledge by the European Central Bank to backstop the troubled EU nations’ debt auctions has injected some stability into the EU financial system. However, offsetting that positive EU news was more generally dour economic data coming out of Europe Thursday. The Chinese premiere on Thursday visited EU leaders and told them his country will continue to buy European Union government bonds.
Don’t be surprised if the EU sovereign debt crisis once again becomes a major market factor in the coming weeks. If such is the case, and with the recent further easing of monetary policy by the major central banks of the world (printing money), this should all augur well for the gold market bulls, given the yellow metal’s safe-haven asset status and with many reckoning gold is only becoming a more valuable reserve currency.
The U.S. dollar index was solidly higher Thursday on more short covering. The greenback bears still have the overall near-term technical advantage as a two-month-old downtrend line remains in place on the daily bar chart. Meantime, crude oil prices are modestly lower Thursday morning and did hit a fresh six-week low overnight. Oil bulls have faded badly this week to suggest a near-term market top is in place. These two key “outside markets” will continue to have a significant daily influence on precious metals prices.
The London P.M. gold fixing is $1,758.50 versus the previous P.M. fixing of $1,766.750.
Technically, December gold futures prices closed nearer the session high Thursday. Prices Wednesday hit a 6.5-month high. The gold market bulls still have the solid overall near-term technical advantage. This week’s pause at higher price levels is not bearish. The gold bulls’ next upside price breakout objective is to produce a close above solid technical resistance at the 2012 high of $1,800.90. Bears’ next near-term downside price objective is closing prices below solid technical support at last week’s low of $1,720.00. First resistance is seen at this week’s high of $1,781.80 and then at $1,790.00. First support is seen at Thursday’s low of $1,757.70 and then at this week’s low of $1,753.20. Wyckoff’s Market Rating: 8.0
December silver futures prices closed nearer the session high Thursday. Silver bulls are in firm near-term technical command. Prices are in a seven-week-old uptrend on the daily bar chart. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $36.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at last week’s low of $32.51. First resistance is seen at this week’s high of $35.10 and then at $35.50. Next support is seen at $34.32 and then at $34.00. Wyckoff’s Market Rating: 8.0.
December N.Y. copper closed down 500 points at 376.40 cents Thursday. Prices closed near mid-range and saw profit taking from recent gains. A stronger U.S. dollar index today also lent to selling pressure in copper. Prices Wednesday hit a 4.5-month high. Copper bulls still have the overall near-term technical advantage. Prices are in a seven-week-old uptrend on the daily bar chart. Copper bulls’ next upside breakout objective is pushing and closing prices above solid technical resistance at 386.45 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 364.00 cents. First resistance is seen at 380.00 cents and then at this week’s high of 383.95 cents. First support is seen at 375.00 cents and then at this week’s low of 372.70 cents. Wyckoff’s Market Rating: 6.5.
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