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03/09/2013 News

P.M. Kitco Metals Roundup: Gold Ends Up on Safe-Haven Demand amid EU Debt Crisis Flare-Up
Monday March 18, 2013 1:50 PM
(Kitco News) - Gold prices ended the U.S. day session with decent gains, hit a fresh three-week high and closed above the key $1,600.00 level Monday. A flare-up in the European Union debt crisis again has traders and investors seeking out safer assets, including gold. The near-term technical posture of the yellow metal is also improving a bit. April Comex gold last traded up $13.30 at $1,605.90 an ounce. Spot gold was last quoted up $14.00 at $1,607.45.  May Comex silver last traded up $0.064 at $28.915 an ounce.
There was a new twist to the European Union sovereign debt crisis during the weekend. Cyprus officials are considering taxing savings accounts in their domestic banks as a part of an overall banking bailout plan tentatively agreed upon with the European Central Bank and the International Monetary Fund over the weekend. That prompted fears other financially troubled nations in the EU could do the same at some point. The Cyprus parliament was set to vote on the new measures Monday, but that vote was rescheduled for Tuesday. This has not only infuriated Cypriots with savings accounts, but also raised fears of a “run” on those banks in the other economically troubled EU countries. There were statements from EU officials that said the Cyprus bailout package was a “one-off” matter and that the savings tax would not be implemented in other EU countries. But that did little to assuage fears among EU citizens with savings deposits at banks.
The Cyprus savings account tax measure was not discussed with Russia, which has a major loan out to the island nation in which Cyprus is trying to extend. The Russians are not at all happy about being left out of the new bailout plan, with Russian president Putin call it unfair and dangerous. Cyprus is a favorite location for Russian millionaires to park their money.
European and Asian stock markets, the Euro currency and U.S. stock indexes were hit hard to the downside on the Cyprus developments. However, the U.S. stock market did recover from its strong early selling pressure as the day progressed Monday. Italian and Spanish bond yields rose Monday, which is a further sign of increasing stress in the European Union.
The U.S. dollar index was higher Monday on perceived safe-have demand amid the EU debt crisis flare-up. Prices are hovering near last week’s 7.5-month high. The U.S. dollar bulls continue to hold the overall technical advantage. Meantime, Nymex crude oil futures prices are near steady Monday. The crude oil bulls and bears are presently on a level near-term technical playing field. These two key “outside markets” will continue to have a significant daily influence on gold and silver prices.
The London P.M. gold fixing is $1,603.75 versus the previous London P.M. fixing of $1,599.50.
Technically, April gold futures prices closed nearer the session high and hit a fresh three-week high Monday. The gold bears still have the slight overall near-term technical advantage. However, the bulls have gained some fresh upside near-term chart momentum to begin to suggest that a market low is in place. Bulls are also working on a fledgling price uptrend on the daily bar chart. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,619.70. Bears' next near-term downside breakout price objective is closing prices below solid technical support at $1,575.00. First resistance is seen at Monday’s high of $1,610.40 and then at $1,619.70. First support is seen at $1,600.00 and then at Monday’s low of $1,589.60. Wyckoff’s Market Rating: 4.5
May silver futures prices closed near mid-range Monday. Silver bears have the near-term technical advantage. However, prices have been trading sideways for the past few weeks as the bulls try to stabilize the market. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $29.495 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at the March low of $27.925. First resistance is seen at today’s high of $29.11 and then at last week’s high of $29.35. Next support is seen at Monday’s low of $28.585 and then at last week’s low of $28.53. Wyckoff's Market Rating: 3.5.
May N.Y. copper closed down 915 points at 342.90 cents Monday. Prices closed nearer the session low today and hit a fresh seven-month low. The copper market was pressured by the “risk-off” day in the market place, which included the bearish outside market, a higher U.S. dollar index. Copper bears have the overall near-term technical advantage and gained fresh downside power today. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 350.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the August 2012 low of 332.00 cents. First resistance is seen at 345.00 cents and then at 347.50 cents. First support is seen at Monday’s low of 341.75 cents and then at 340.00 cents. Wyckoff's Market Rating: 2.5.