(Kitco News) - Gold prices ended the U.S. day session modestly lower Tuesday, on some profit taking amid an increase in risk appetite among traders and investors early this week. The yellow metal’s price did finish up from the session low on some bargain hunting and as the U.S. dollar index backed down from its daily high. February Comex gold was last down $1.30 at $1,089.30 an ounce. March Comex silver was last up $0.219 at $14.115 an ounce.
Risk aversion in the world marketplace was not high Tuesday, the first trading day of the week in the U.S. Economic data from China Tuesday showed the world’s second-largest economy had a gross domestic product growth rate of 6.9% in 2015, which was higher than many market watchers had expected but still the slowest growth rate in China in around 25 years. Most world stock markets were boosted on the China news. U.S. stock indexes were firmer but well down from their daily highs in afternoon trading.
There was more downbeat economic data coming out of the European Union Tuesday.
Euro zone consumer price inflation was pegged at zero percent in December, month-on-month, and up 0.2% year-on-year. Also, the closely watched German ZEW economic expectations index fell to 10.2 in January from 16.1 in December. However, the January reading was higher than expectations.
The IMF on Tuesday cut its global economic growth forecast number, citing slowing growth in China and concerns about emerging market financial contagion. The IMF pegged 2016 world economic growth at 3.4%, down 0.2% from its last estimate.
The other key “outside market” crude oil is dropped to a 12-year low of $28.36 a barrel today. The International Energy Agency said oil prices could fall further this year due to the major glut of oil in the world market. The IEA said there is more than 1 million barrels a day of supply over demand being added to world oil stockpiles.
U.S. economic data released Tuesday was light and included the NAHB housing market index and Treasury international capital data. These reports had no market impact.
Technically, February gold futures prices closed near mid-range today. The gold bears have the firm overall near-term technical advantage. However, the recent choppy, sideways trading does favor the bulls. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the January high of $1,113.10. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at 1,056.50. First resistance is seen at today’s high of $1,094.50 and then at $1,100.00. First support is seen at today’s low of $1,082.10 and then at $1,076.00. Wyckoff’s Market Rating: 3.0
March silver futures prices closed nearer the session high today on short covering in a bear market. The silver market bears still have the firm overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $14.425 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the contract low of $13.64. First resistance is seen at last week’s high of $14.205 and then at $14.425. Next support is seen at $14.00 and then at today’s low of $13.84. Wyckoff's Market Rating: 2.0.
March N.Y. copper closed up 360 points at 197.95 cents today. Prices closed near mid-range on short covering after hitting a contract and six-year low early on today. Prices did score a mildly bullish “outside day” up on the daily bar chart today, and if there is strong follow-through buying on Wednesday then a more bullish “key reversal” up would be confirmed, which would be one chart clue that a market bottom is in place. But right now the copper bears have the solid overall near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 210.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 190.00 cents. First resistance is seen at 200.00 cents and then at today’s high of 201.30 cents. First support is seen at $1.9500 and then at today’s contract low of 193.55 cents. Wyckoff's Market Rating: 2.0.
By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com
Follow me on Twitter @jimwyckoff
