Gold And Silver Prices See Normal Downside Corrections

New York (Dec 13)  Gold prices are modestly lower in early-afternoon U.S. trading Thursday. Silver prices are near steady after hitting a five-week high overnight. Both metals are saw normal corrective pullbacks and some chart consolidation from recent gains. February gold futures were last down $2.60 an ounce at $1,247.40. March Comex silver was down $0.001 at $14.85 an ounce.

Today’s meeting of the European Central Bank saw no changes in interest rates, but the ECB announced the end of its quantitative easing of monetary policy. ECB President Mario Draghi at his press conference after the meeting gave a downbeat assessment for European Union economic growth prospects. Metals prices were little moved on the news.

European stock markets were mostly weaker overnight. Asian stock indexes were mostly firmer. U.S. stock indexes are weaker in afternoon trading. World equity markets have been assuaged this week by the perceived progress between the U.S. and China in their trade talks. Reports say China is making somewhat significant changes to come into line with U.S. demands. While the rally in the equities markets on the trade talks’ progress is a bearish element for the competing assets gold and silver, the prospect for better worldwide demand for metals on a U.S.-China trade agreement is bullish for the metals.

The key outside markets early today find the U.S. dollar index firmer and not far below the fresh for-the-move high scored Tuesday. Meantime, Nymex crude oil prices are firmer and trading around $52.00 a barrel.

Technically, the gold bulls still have the overall near-term technical advantage. A four-week-old price uptrend is in place on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close in February futures above solid technical resistance at the July high of $1,284.10. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,225.00.

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