(Kitco News) - Comex April gold futures prices are trading modestly lower in early U.S. dealings Monday, on a corrective, profit-taking pullback from recent solid gains that pushed prices to a three-month high last week. The key “outside markets” are in a bearish daily posture for the precious metals early Monday, as the U.S. dollar index is firmer and crude oil prices are lower. April gold last traded down $9.00 at $1,767.40 an ounce. Spot gold was last quoted down $7.60 an ounce at $1,766.50. March Comex silver last traded down $0.223 at $35.115 an ounce.
The Mid-East tensions did not escalate over the weekend, which allowed the European Union sovereign debt crisis to creep back to share the front burner early this week. Moody’s early Monday issued a report saying a default by Greece on its sovereign debt is still very possible. Also, the Group of 20 nations issued a statement over the weekend saying the group is hesitant to keep offering bailouts to debt-strapped EU countries. This put the European stock markets under modest pressure, which in turn pressured the Euro currency.
However, losses in gold Monday are limited by the present stare-down between allies Israel and the U.S, and Iran. Increasing focus in the media on the potential for Israel or U.S. military action against Iran has prompted increase investor anxiety in the market place. That’s bullish for safe-haven gold, and to a lesser degree bullish for silver. The tensions between Israel and the West, and Iran, are and likely will remain a major bullish fundamental factor for the gold market.
The U.S. dollar index is firmer Monday morning on a short-covering bounce from recent selling pressure. This is a bit of a bearish weight on gold and silver Monday. The greenback bears still have some downside technical momentum on their side. Meantime, Nymex crude oil futures prices are seeing a corrective pullback after hitting a 9.5-month high last week. The recent rally in crude oil prices is a major bullish factor for the precious metals.
U.S. economic data due for release Monday includes pending home sales index and the Texas manufacturing survey.
The London A.M. gold fixing was $1,765.00 versus the previous London P.M. fixing of $1,777.50.
Technically, April gold futures bulls still have some upside near-term technical momentum. Don’t be surprised to see some bargain hunters step in soon to buy the dip in prices. Gold bulls still have the solid overall near-term technical advantage. Bulls' next upside technical breakout objective is to produce a close above solid technical resistance at the November high of $1,808.00. Bears' next near-term downside price objective is closing prices below solid technical support at the February low of $1,706.70. First resistance is seen at the overnight high of $1,779.80 and then at last week’s high of $1,789.50. First support is seen at the overnight low of $1,762.60 and then at $1,750.00.
March silver futures bulls still have the overall near-term technical advantage and still have some upside technical momentum. Prices are in a two-month-old uptrend on the daily bar chart. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $37.50 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at the February low of $32.64. First resistance is seen at last week’s high of $35.72 and then at $36.00. Next support is seen at $35.00 and then at $34.52.
Source; http://www.kitco.com/reports/KitcoNews20120227JW_am.html
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