(Kitco News) - Comex December gold futures prices ended the U.S. day session modestly lower Wednesday. It was a “risk-off” day in the market place Wednesday as European and U.S. stock markets sold off sharply amid an escalation in the European Union sovereign debt crisis. Despite being a safe-haven asset, the gold market felt selling pressure from a sharply higher U.S. dollar index and generally weaker commodity sector Wednesday. Some profit-taking pressure from recent solid price gains also occurred in the precious metals. December gold last traded down $15.50 at $1,783.40 an ounce. Spot gold last traded down $2.80 an ounce at $1,782.75. December Comex silver last traded down $1.038 at $34.115 an ounce.
The European Union financial and sovereign debt crisis was ratcheted up several notches Wednesday as Italian government bond yields pushed above the critical 7% level, which calls into question Italy’s ability to service its debt. Italy’s prime minister resigned Tuesday. On top of all this, the Greek government is in disarray. This is making for a keen “risk-off” trader mentality in the market place. While not evident Wednesday for gold or silver, the heightened uncertainty is still an overall bullish underlying factor for the precious metals markets, and especially gold.
It would not be surprising to see bargain-hunting buying interest surface soon in gold soon, as traders “buy the dip.” Such has been the case in recent history.
The U.S. dollar index traded sharply higher Wednesday, on perceived safe-haven demand for the greenback and U.S. Treasuries, amid the EU debt crisis escalation. The dollar index bulls have gained some upside near-term technical momentum recently. Crude oil prices were weaker Wednesday, along with most other commodity markets, and that’s a bearish underlying bullish “outside market” force for the precious metals. Crude oil prices remain in a near-term uptrend, however.
The London P.M. gold fixing was $1,784.00 versus the previous P.M. fixing of $1,795.00.
Technically, December gold futures prices closed nearer the session low Wednesday. Gold bulls still have solid the overall near-term technical advantage. A six-week-old uptrend is in place on the daily bar chart. Bulls' next upside technical objective is to produce a close above solid technical resistance at $1,850.00. Bears' next near-term downside price objective is closing prices solid technical support at $1,750.00. First resistance is seen at this week’s high of $1,804.40 and then at $1,825.00. First support is seen at Wednesday’s low of $1,778.80 and then at $1,769.50. Wyckoff's Market Rating: 7.0.
December silver futures prices closed nearer the session low Wednesday. The key “outside markets” were bearish for silver, as the U.S. dollar index was stronger and crude oil prices were weaker. The silver bulls have the overall near-term technical advantage. A six-week-old uptrend is still in place on the daily bar chart. Silver bulls' next upside price objective is producing a close above solid technical resistance at the October high of $35.70 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at last week’s low of $32.105. First resistance is seen at $35.00 and then at today’s high of $35.255. Next support is seen at Wednesday’s low of $34.085 and then at this week’s low of $33.855. Wyckoff's Market Rating: 6.0.
December N.Y. copper closed down 1,230 points 341.45 cents Wednesday. Prices closed near the session low today and hit a fresh two-week low. Copper bulls faded Wednesday. The key “outside markets” were bearish for copper as the U.S. dollar index was sharply higher, while the U.S. stock indexes were sharply lower and crude oil prices were also weaker. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at this week’s high of 365.35 cents. The next downside price breakout objective for the bears is closing prices below solid technical support 330.00 cents. First resistance is seen at 345.00 cents and then at 350.00 cents. First support is seen at 340.00 cents and then at 335.00 cents. Wyckoff's Market Rating: 5.0.
Source; http://www.kitco.com/reports/KitcoNews20111109JW_pm.html
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