In an unpredictable trading session Wednesday afternoon, Gold prices traded low after hitting a three-week high on Tuesday. Spot gold went down $3.20 at $1,194.75 an ounce. February Comex gold went down $2.80 at $1,195.00. March Comex silver was last traded up $0.105 at $16.33 an ounce.
Wednesday’s late-morning steep sell off for gold matched a poll showing the Swiss “Save Our Gold” push that held 38% of the voters in favor of the Swiss government increasing its gold holdings to 20% of their assets. The final vote by the Swiss takes place November 30th. By midday, gold prices made up their losses.
The Bank of Japan announced that it would continue with its monetary easing policy even in the face of a dreary Japanese GDP report released earlier this week. The BOJ governor said last month’s monetary policy easing moves were correct changes to make. Wednesday’s economic data coming out of the European Union were equally as weak. EU construction spending declined 1.8% across the region in September, year-on-year.
The U.S. dollar continues to be strong compared to other major currencies. The fear of weakening world economies and looming price deflations are making their way to the front of world economic discussion boards. The raw commodity sector is seeing the brunt of these concerns as their major down cycle continues on. Low interest rates and a bear market make holding bonds unappealing. And as the down cycle in raw commodities continues, the up cycle in equities is expected to reverse sooner than most experts expected.
A corrective technical pullback occurred Wednesday while February gold futures priced out near mid-range in afternoon trading. Bears regained some downside technical momentum and carries the near-term technical advantage. Gold bulls’ next upside near-term price breakout objective is projecting a close above solid technical resistance at $1,225.00. Bears’ next near-term downside breakout price objective has closing prices below solid technical support at $1,160.00. First resistance is projecting at $1,200.00 followed by this week’s high of $1,204.70, while first support is at today’s low of $1,174.70 followed by $1,170.00. Wyckoff’s Market Rating: 2.5.
March silver futures priced out near mid-range and hit a three-week high early Wednesday. The overall near-term technical advantage is still held by silver bears. Prices are stuck in a four-month-old downtrend on the daily bar chart. Silver bulls’ next upside price breakout objective is projecting closing prices above solid technical resistance at $17.00 an ounce. The bears’ next downside price breakout objective has closing prices below solid support of $15.085. First resistance is seen at a high of $16.575 followed by $16.715. Next support is projecting a low of $15.93 and then $15.75. Wyckoff’s Market Rating: 2.0.
March N.Y. copper closed up 300 points at 302.20 cents. Prices closed on a short covering in a bear market nearer the Wednesday’s session high. The near-term technical advantage is still held by the bears. Copper bulls’ next upside breakout objective was pushing and closed prices above solid technical resistance at 310.35 cents. First resistance projected a high of 303.60 cents and then at the week’s high of 305.05 cents. First support is 300.00 cents and last week’s low of 297.70 cents. Wyckoff’s Market Rating: 2.5.
