Gold and silver markets down as risk appetite returns at mid-week
New York (Dec 4) Gold and silver prices are down in midday U.S. trading Wednesday, after gold notched a four-week high in the early going. A rally in the U.S. stock market today prompted some selling pressure in the safe-haven metals. The good news for the gold and silver bulls this week is that both markets have seen their near-term price downtrends eliminated, at least temporarily. February gold futures were last down $4.50 an ounce at 1,479.90. March Comex silver prices were last down $0.308 at $16.94 an ounce.
Risk appetite returned to the marketplace at mid-week on fresh news reports the U.S. and China are close to a trade deal. Amid a lack of other major news developments trader and investor focus remains on the rhetoric coming from the U.S. and China regarding their trade negotiations. For whatever reason, the marketplace at mid-week is more upbeat than Tuesday, on the chances for a trade agreement soon between the world’s two largest economies. It’s hard to imagine the two sides reaching a substantive trade deal soon, given comments coming from both sides. And the U.S. House of Representatives passed a bill late Tuesday requiring U.S. punishment of Chinese officials involved in the repression of Uighur Muslims in the country. China quickly vowed retaliation.
This morning’s ADP national employment report for November came in at up just 67,000 jobs, which is a big miss to the downside from market expectations for a rise of 150,000. The gold market briefly erased modest overnight losses on the news. The U.S. economic data point of the week is Friday’s employment situation report from the Labor Department. The key non-farm payroll number is expected to come in at up around 185,000 jobs.
The key “outside markets” today see the U.S. dollar index weaker again today and hitting a four-week low. The greenback bulls have faded recently. Meantime, Nymex crude oil prices are sharply higher and trading around $58.50 a barrel.
Technically, February gold bulls and bears are on a level overall near-term technical playing field. A three-month-old downtrend on the daily bar chart has this week been at least temporarily negated. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,500.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the November low of $1,453.10. First resistance is seen at today’s high of $1,489.90 and then at $1,500.00. First support is seen at $1,475.00 and then at Tuesday’s low of $1,465.40. Wyckoff's Market Rating: 5.0
March silver futures prices scored a bearish “outside day” down on the daily bar chart today. The silver bears have the slight overall near-term technical advantage. However, a price downtrend on the daily chart has this week been negated. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $17.50 an ounce.
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