Gold Hits 2-Wk High, But Then Backs Off On Bearish Outside Mkts

(Kitco News) - Gold prices ended the U.S. day session modestly lower Thursday, after poking to a two-week high early on. Slight early gains were erased in morning trading when the outside markets turned bearish—the U.S. dollar index rallied and crude oil prices sold off. December Comex gold was last down $3.00 an ounce at $1,266.90. December Comex silver was last down $0.118 at $17.545 an ounce.

Gold bulls are still having the better week, so far, and today’s price action could be termed by the chart watchers as just a downside correction following the gains earlier this week.

U.S. economic data Thursday was a mixed bag. A downbeat weekly jobless claims report did briefly push gold prices to their daily highs in early morning trading. However, the bearish outside markets on this day trumped the U.S. economic data, regarding impacting gold prices.

The most significant economic event of the day Thursday saw the European Central Bank leave its monetary policy unchanged at its regular meeting, which was what the marketplace expected. The marketplace does look for the ECB to make monetary policy changes in December.

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Technically, December gold futures prices closed nearer the session low but did hit a two-week high early on today. The gold bears have the overall near-term technical advantage. Prices are still in a 3.5-month-old downtrend on the daily bar chart. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,300.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the October low of $1,243.20. First resistance is seen at today’s high of $1,275.90 and then at $1,280.00. First support is seen at Wednesday’s low of $1,261.10 and then at $1,255.90. Wyckoff’s Market Rating: 4.0

December silver futures prices closed near mid-range today. The silver market bears still have the overall near-term technical advantage. Prices are in a 3.5-month-old downtrend on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $18.46 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $17.00. First resistance is seen at this week’s high of $17.79 and then at $18.04. Next support is seen at today’s low of $17.45 and then at last week’s low of $17.315. Wyckoff's Market Rating: 3.5.

December N.Y. copper closed down 75 points at 209.60 cents today. Prices closed near mid-range and hit a six-week low today. The key “outside markets” were bearish for copper today as the U.S. dollar index was higher and crude oil prices were lower. The copper bears have the overall near-term technical advantage. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 218.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the September low of 206.40 cents. First resistance is seen at today’s high of 211.15 cents and then at this week’s high of 212.30 cents. First support is seen at today’s low of 208.45 cents and then at 206.40 cents. Wyckoff's Market Rating: 3.0.

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