(Kitco News) -Comex February gold futures prices ended the U.S. day session moderately higher Wednesday, hitting a fresh four-week high. Fresh safe-haven buying interest was featured. Prices also Wednesday pushed above near-term chart resistance to provide the bulls with fresh upside near-term technical momentum. The fact gold scored gains Wednesday despite the key “outside markets” being in a bearish posture for gold (higher U.S. dollar index and weaker crude oil prices) is also encouraging to the gold bulls. February gold last traded up $9.30 at $1,640.80 an ounce. Spot gold was last quoted up $7.70 an ounce at $1,640.50. March Comex silver last traded up $0.12 at $29.935 an ounce.
There are also reports this week of better physical demand for gold, especially from Asian countries, as the new year gets under way.
The U.S. dollar index traded solidly higher Wednesday and hit a fresh 16-month high, yet gold scored gains anyway. The dollar index bulls still have the solid overall near-term technical advantage. With traders focusing more on gold as a safe-haven store of value, they will pay less attention to the value of the U.S. dollar on a day-to-day basis.
Crude oil prices traded modestly lower Wednesday, but are still trading above $100.00 a barrel. Crude oil will remain an important “outside market” factor for the precious metals.
There have been no major, fresh developments coming out of the European Union debt crisis recently. There is another EU summit scheduled for January 30, reports said Wednesday. If recent history continues to play out it won’t be too long until the EU debt crisis is back on the front burner of the market place, which could further boost gold on better safe-haven investment demand. Italian bond yields are still very high, which is a warning signal the EU debt crisis could escalate at any time.
The London P.M. gold fixing was $1,634.50 versus the previous P.M. fixing of $1,637.00.
Technically, February gold futures prices closed near mid-range Wednesday. Gold rallied despite bearish “outside market” forces today—a stronger U.S. dollar index and lower crude oil prices. This is another bullish near-term clue for the gold market. A two-month-old downtrend on the daily bar chart was negated Wednesday. Prices have also pushed back above the closely watched 200-day moving average in gold. Bulls have gained fresh upside technical momentum recently. Bulls' next upside technical breakout objective is to produce a close above psychological resistance at $1,700.00. Bears' next near-term downside price objective is closing prices below solid technical support at $1,562.50. First resistance is seen at today’s high of $1,648.00 and then at $1,670.00. First support is seen at Wednesday’s low of $1,630.80 and then at $1,620.00. Wyckoff's Market Rating: 5.5.
March silver futures prices closed near mid-range in quieter trading Wednesday. The key “outside markets” were bearish for silver, as the U.S. dollar index was higher and crude oil prices were lower. Bulls this week have gained some fresh upside technical momentum. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $31.00 an ounce. The next downside price breakout objective for the bears is closing prices below major technical support at $28.12. First resistance is seen at this week’s high of $30.31 and then at $30.50. Next support is seen at Wednesday’s low of $29.545 and then at $29.00. Wyckoff's Market Rating: 4.5.
March N.Y. copper closed up 320 points 354.50 cents Wednesday. Prices closed near the session high. Copper bulls have the slight near-term technical advantage. Prices are in a three-week-old uptrend on the daily bar chart. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at the December high of 367.40 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 332.50 cents. First resistance is seen at Wednesday’s high of 355.65 cents and then at the January high of 358.25 cents. First support is seen at 350.00 cents and then at Wednesday’s low of 347.05 cents. Wyckoff's Market Rating: 5.5.
Source; http://www.kitco.com/reports/KitcoNews20120111JW_PM.html
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