Gold, Silver Boosted By Dovish Central Banks, Slumping U.S. Dollar

(Kitco News) - Gold and silver markets saw good follow-through buying interest Thursday, following solid gains Wednesday that came in the aftermath of central bank meetings in Japan and the U.S. that were deemed dovish on their monetary policies. December Comex gold was last up $13.20 an ounce at $1,344.60. December Comex silver was last up $0.307 at $20.075 an ounce.

The U.S. dollar index also saw follow-through selling and traded solidly lower following the dovish-construed FOMC statement released Wednesday afternoon. Crude oil prices were higher again Thursday on more short covering after hitting a six-week low Tuesday. A bullish weekly U.S. storage report on Wednesday also supported oil prices. Crude oil prices remain in a near-term downtrend, however. These two key “outside markets” were in a bullish posture for the precious metals Thursday.

There was a heavy slate of U.S. economic data due for release Thursday, including the weekly jobless claims report, the Chicago Fed national activity index, the monthly house price index, leading economic indicators, existing home sales, and the Kansas City Fed manufacturing survey. Collectively, the data was mixed but favored the weak side of market expectations, and that was also friendly for the precious metals markets.

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Technically, December gold futures prices closed nearer the session high and hit a two-week high today. The gold bulls have the overall near-term technical advantage and have gained more power late this week. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the September high of $1,357.60. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the September low of $1,305.50. First resistance is seen at today’s high of $1,347.80 and then at $1,350.00. First support is seen at today’s low of $1,335.10 and then at $1,330.00. Wyckoff’s Market Rating: 6.5

December silver futures prices closed nearer the session high and hit a two-week high today. The silver market bulls have the overall near-term technical advantage and have gained good upside momentum this week. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at the September high of $20.235 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the August low of $18.46. First resistance is seen at $20.235 and then at $20.50. Next support is seen at today’s low of $19.785 and then at $19.50. Wyckoff's Market Rating: 6.5.

December N.Y. copper closed up 390 points at 219.45 cents today. Prices closed nearer the session high and hit a five-week high today. The key “outside markets” were bullish for copper today as the U.S. dollar index was solidly lower and crude oil prices were higher. The copper bulls have gained the overall near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 225.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at this week’s low of 206.40 cents. First resistance is seen at today’s high of 220.10 cents and then at 221.50 cents. First support is seen at $2.1725 and then at today’s low of 216.05 cents. Wyckoff's Market Rating: 6.0.

By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com