02/28/2013 News

(Kitco News) - Gold futures prices are modestly lower in early U.S. trading Thursday, as a “risk-on” trader and investor mentality has pervaded the market place late this week. That’s bearish for the safe-haven gold market. The near-term technical posture of gold remains bearish, which is also keeping buyers scarce. April Comex gold last traded down $4.00 at $1,591.40 an ounce. Spot gold was last quoted down $3.70 at $1,593.00.  May Comex silver last traded up $0.045 at $29.03 an ounce.
The U.S. government’s likely inability to agree on a taxing and spending plan by the March 1 sequestration deadline is being mostly ignored in the world market place late this week, as the U.S. stock market rallied sharply Wednesday amid a “risk-on” trader and investor mentality. U.S. stock index futures were trading modestly higher Thursday morning on some follow-through buying strength. President Obama will meet with congressional leaders Friday on the budget matters. Traders and investors are becoming somewhat numb to the ongoing squabbling in Washington, D.C.
The European Union and its sovereign debt problems have surfaced again this week. The Italian elections failed to show a clear winner as voters ostensibly rebuked present government austerity measures. The head of the Organization for Economic Cooperation and Development (OECD) said Thursday the Italian election gridlock will not significantly impact the EU debt crisis and efforts to stabilize it. There were Italian government debt auctions Tuesday and Wednesday that were deemed successful, even though yields were a bit higher. On Thursday, Spanish and Italian bond yields fell slightly, in another positive sign the EU debt crisis is now stable. The latest episode in the EU debt crisis appears to be calming down just a bit as the week progresses. European Central Bank chief Mario Draghi said Thursday he will continue to “preserve the integrity” of the Euro currency. European stock markets were mostly higher Thursday on better corporate earnings reports coming out of Europe. The seemingly improved attitudes in the market place, regarding the EU debt crisis, are also an underlying bearish factor for the safe-haven gold market late this week.
The U.S. dollar index is slightly lower early Thursday on a mild profit-taking pullback after prices Tuesday hit a six-month high. The U.S. dollar bulls still have upside technical momentum to suggest the dollar index has put in a market bottom. That’s also bearish for gold and silver. Meantime, Nymex crude oil futures prices near steady early Thursday. Prices Tuesday hit a two-month low. The crude oil bears still have some downside near-term technical momentum and that’s also a negative for gold and silver.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the fourth-quarter GDP estimate, the ISM Chicago business survey, and the Kansas City Fed manufacturing index.
The London A.M. gold fixing is $1,591.00 versus the previous London P.M. fixing of $1,604.25. Technically, April gold futures prices are still in a six-week-old downtrend on the daily bar chart. Bears still have the overall near-term technical advantage. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the January low of $1,627.90. Bears' next near-term downside breakout price objective is closing prices below solid technical support at last week’s low of $1,554.30. First resistance is seen at the overnight high of $1,602.50 and then at Wednesday’s high of $1,614.40. First support is seen at the overnight low of $1,585.30 and then at $1,580.00.
May silver futures bears have the near-term technical advantage. Prices are in a six-week-old downtrend on the daily bar chart. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $30.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at last week’s low of $28.315. First resistance is seen at the overnight high of $29.19 and then at this week’s high of $29.495. Next support is seen at the overnight low of $28.81 and then at this week’s low of $28.60.
Follow me on Twitter to immediately get the very latest market developments. If you are not on board, then you are not getting key analysis and perspective as fast or as often as you could! Follow me on Twitter to get my very timely intra-day and after-hours briefs on precious metals price action. The precious markets will remain very active. If you want market analysis fast, and in after-hours trading, then follow my up-to-the-second precious metals market perspective on Twitter. It's free, too. My account is @jimwyckoff.
 
By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com

02/21/2013 News

P.M. Kitco Metals Roundup: Gold Stabilizes on Short Covering, Bargain Hunting; U.S. Stock Mkt May Provide Bullish Clue for Gold
Thursday February 21, 2013 1:58 PM
(Kitco News) - Comex gold futures prices ended the U.S. day session slightly higher and nearer the daily high Thursday, after hitting a fresh 8.5-month low overnight. Some tepid short covering and bargain hunting were featured following the recent strong selling pressure. The stronger U.S. dollar index is a major bearish factor for the precious metals markets and did limit buying interest not only in gold and silver Thursday, but also across the entire raw commodity spectrum. April Comex gold last traded up $0.70 at $1,578.90 an ounce. Spot gold was last quoted up $15.10 at $1,580.00.  March Comex silver last traded up $0.028 at $28.645 an ounce.
There is an early, potentially bullish development for the gold and silver markets, and it lies with the U.S. stock market. The Dow and S&P 500 stock index futures are poised to close lower on Thursday. If that is the case, then significantly technically bearish “key reversals” down would be confirmed on the daily  bar charts for both indexes, following the bearish “outside day” down price action on the daily charts for both on Wednesday. Key reversals down would be an early technical clue that the Dow and S&P 500 have put in at least near-term market tops. Another bearish clue that the U.S. stock market is headed for some lean times just ahead is that the copper futures market has been hammered lower this week. History shows that the red industrial metal can be a leader of significant price movements in the stock market. Market tops in the U.S. stock indexes would mean less investor monies flowing into stocks, which would also suggest increased investor and trader demand in other asset classes, such as gold and silver.
Traders are still digesting the release Wednesday afternoon of the Federal Reserve’s Open Market Committee minutes from early January. Those minutes said U.S. economic conditions are improving to the point that some FOMC members think its massive asset- purchasing program (quantitative easing) may have to be changed soon. The FOMC will further address the issue at its next meeting in March. It can be argued, and many market analysts are saying, that some markets overreacted to the FOMC minutes. First, there was not at all a consensus among the FOMC members on whether to end the asset purchase program sooner rather than later. And if the Fed does indeed target the unemployment rate for its monetary policy decisions, the easy money policy of the central bank likely won’t end any time soon. Fed Chairman Bernanke also remains firmly in the dovish monetary policy camp, most agree.
European stocks and the Euro currency slumped Thursday, following the lead of the U.S. markets Wednesday afternoon. European stocks were also hurt by disappointing Euro zone purchasing managers’ data from Markit that was released Thursday. That data suggests the Euro zone is still in overall economic contraction in the first quarter.
Asian stock markets were also weaker Thursday, following the release of the U.S. FOMC minutes. China’s stock market dropped sharply Thursday after Chinese officials reiterated it wants to keep domestic property prices in check—which could mean tighter monetary policy in the near future. China’s central bank also made a large withdrawal of cash from the banking system this week, in an effort to keep price inflation in check. This is also a negative for the precious metals markets this week.
Reports Thursday said physical demand for gold in India is increasing due to the recent sharp fall in prices prompting some bargain hunting from consumers.
The U.S. dollar index was solidly higher early Thursday and hit a fresh three-month high overnight. The U.S. dollar bulls have gained strong upside technical momentum recently, to suggest the dollar index has put in a market bottom and that prices can now trend sideways to higher in the near term. Meantime, Nymex crude oil futures prices are solidly lower Thursday and hit a fresh six-week low. The crude oil bulls have faded badly this week. The sell off in crude oil this week is also bearish for the raw commodity sector, including the precious metals.
The London P.M. gold fixing is $1,577.00 versus the previous London P.M. fixing of $1,588.50.
Technically, April gold futures prices closed nearer the session high Thursday after hitting a fresh 8.5-month low early on. Tepid short covering and bargain hunting were featured today. The market is still presently well oversold on a short-term technical basis.
Serious near-term technical damage has been inflicted recently. Gold prices are in an accelerating five-week-old downtrend 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 this week’s high of $1,618.80. Bears' next near-term downside breakout price objective is closing prices below solid technical support at the May 2012 low of $1,538.70. First resistance is seen at Thursday’s high of $1,584.40 and then at $1,590.00. First support is seen at $1,570.00 and then at $1,560.00. Wyckoff’s Market Rating: 2.5
March silver futures prices closed nearer the session high on tepid short covering in a bear market. Serious near-term technical damage has been inflicted in silver recently. Prices Wednesday hit a six-month low. March silver bears have the solid near-term technical advantage. However, the silver market is also short-term oversold, technically.
Prices are in an accelerating five-week-old downtrend on the daily bar chart. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $30.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $28.00. First resistance is seen at Thursday’s high of $28.88 and then at $29.00. Next support is seen at Wednesday’s low of $28.31 and then at $28.00. Wyckoff's Market Rating: 2.5.
March N.Y. copper closed down 520 points at 355.60 cents Thursday. Prices closed nearer the session low and hit a fresh two-month low as the bulls have faded badly. Serious near-term chart damage has been inflicted this week. The key “outside markets” were bearish for copper again Thursday, as the U.S. dollar index was higher and crude oil prices were solidly lower. Copper bears now have the near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 365.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the December low of 352.30 cents. First resistance is seen at 357.50 cents and then at 360.00 cents. First support is seen at Thursday’s low of 353.70 cents and then at 352.30 cents. Wyckoff's Market Rating: 3.5.
Follow me on Twitter to immediately get the very latest market developments. If you are not on board, then you are not getting key analysis and perspective as fast or as often as you could! Follow me on Twitter to get my very timely intra-day and after-hours briefs on precious metals price action. The precious markets will remain very active. If you want market analysis fast, and in after-hours trading,then follow my up-to-the-second precious metals market perspective on Twitter. It's free, too. My account is @jimwyckoff.
 
By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com




02/20/2013 News

P.M. Kitco Metals Roundup: Gold Hammered to 7.5-Mo. Low on Technical Selling, Bearish FOMC Minutes
Wednesday February 20, 2013 3:00 PM
(Kitco News) - Gold prices ended the U.S. day session sharply lower Wednesday, and then extended those losses in the afternoon following a bearish FOMC minutes report. Prices hit a fresh 7.5-month low as the precious yellow metals bulls are presently reeling. April gold last traded down $43.50 at $1,560.90 an ounce. Spot gold was last quoted down $44.90 at $1,560.50.  March Comex silver last traded down $1.017 at $28.405 an ounce.
The Federal Reserve’s Open Market Committee in early January said U.S. economic conditions are improving to the point that its massive asset purchasing program (quantitative easing) may have to be changed. The FOMC will further address the issue at its next meeting in March. Worries the FOMC minutes would indeed be bearish added to the technical selling pressure Wednesday morning. These minutes in the past few months have been market-movers, just like Wednesday’s. The U.S. Treasury markets, with their recent rising bond yields, are also hinting that the Fed’s very accommodative monetary policy of the past few years will start to wind down in the not-too-distant future. That’s yet another underlying bearish factor for the raw commodity sector, including gold and silver.
Wednesday’s price action on the daily chart for April Comex gold futures saw the 50-day moving average cross below the 200-day moving average, to produce what is called a “death cross.” This term has become somewhat popular in recent years, partly because it sounds so ominous. However, the technical significance of this particular moving average crossover signal is not major. In fact, a Dow Jones report Wednesday said that Schaeffer’s Investment Research analyst Ryan Detrick did a historical analysis of the death cross on gold, and he found that on average gold prices actually rebounded somewhat in the weeks and months following the death cross.
Another major bearish factor for the gold and silver markets in recent weeks has been rallying stock markets worldwide, which shows investor risk appetite is on the upswing—at the expense of demand for safe-haven assets like gold and to a lesser degree silver. The recent strength of the U.S. dollar index is also an underlying bearish factor for the precious metals markets. Recent developments coming out of the European Union paint a picture of improving financial and economic conditions, to suggest the EU has turned the corner toward recovery from its sovereign debt crisis. That’s also a bearish underlying factor for the safe-haven gold market.
The U.S. dollar index was sharply higher Wednesday afternoon and hit a fresh a three-month high. The U.S. dollar bulls have gained solid upside technical momentum recently, including more Wednesday, to suggest the dollar index has put in a market bottom. Meantime, Nymex crude oil futures prices were sharply lower Wednesday and hit a fresh five-week low, mainly due to the stronger U.S. dollar index. The crude oil bulls still have the slight overall near-term technical advantage but have faded recently. If crude oil bulls continue to weaken that would be a bearish development for the raw commodity sector, including the precious metals. These two key “outside markets” were in a fully bearish posture for the precious metals markets Wednesday.
The London P.M. gold fixing is $1,588.50 versus the previous London P.M. fixing of $1,607.75.
Technically, April gold futures prices closed nearer the session low Wednesday and hit a fresh 7.5-month low. Serious near-term technical damage has been inflicted recently, including more Wednesday. Gold prices are in an accelerating four-week-old downtrend 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 this week’s high of $1,618.80. Bears' next near-term downside breakout price objective is closing prices below solid technical support at the May 2012 low of $1,538.70. First resistance is seen at $1,570.00 and then at $1,580.00. First support is seen at $1,550.00 and then at $1,538.70. Wyckoff’s Market Rating: 2.5
March silver futures prices closed nearer the session low and hit another fresh six-month low Wednesday. Serious near-term technical damage has been inflicted in silver recently, including more Wednesday. March silver bears have the solid near-term technical advantage. Prices are in an accelerating four-week-old downtrend on the daily bar chart. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $30.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $28.00. First resistance is seen at $28.50 and then at  $29.00. Next support is seen at today’s low of $28.27 and then at $28.00. Wyckoff's Market Rating: 2.5.
March N.Y. copper closed down 465 points at 360.30 cents Wednesday. Prices closed nearer the session low and hit a fresh seven-week low as the bulls have faded badly. The key “outside markets” were fully bearish for copper Wednesday, as the U.S. dollar index was sharply higher and crude oil prices were sharply lower. Copper bulls and bears are now back on a level near-term technical playing field. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 370.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the December low of 352.30 cents. First resistance is seen at 362.50 cents and then at 365.00 cents. First support is seen at Wednesday’s low of 359.75 cents and then at 357.50 cents. Wyckoff's Market Rating: 5.0.
Follow me on Twitter to immediately get the very latest market developments. If you are not on board, then you are not getting key analysis and perspective as fast or as often as you could! Follow me on Twitter to get my very timely intra-day and after-hours briefs on precious metals price action. The precious markets will remain very active. If you want market analysis fast, and in after-hours trading,then follow my up-to-the-second precious metals market perspective on Twitter. It's free, too. My account is @jimwyckoff.
 
By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com