Gold is moderately higher this Thursday on an upside corrective bounce and bargain hunting. The US dollar also traded lower and oil prices have rose. Many bargain hunters are stepping in to buy the metals while the prices are low and to take advantage of the dips.
By Jim Wyckoff
3/08/2012 @ 8:57AM
(Kitco News) - Comex gold futures prices are moderately higher in early U.S. trading Thursday. The market is seeing an upside corrective bounce and bargain hunting following recent losse. Many commodity markets are seeing upside price action Thursday amid a “risk on” trader mentality in the market place. The key “outside markets” are bullish for the precious metals markets early Thursday, as the U.S. dollar index is lower and crude oil prices are higher. April gold last traded up $14.10 at $1,698.00 an ounce. Spot gold was last quoted up $13.00 an ounce at $1,697.75. May Comex silver last traded up $0.435 at $34.02 an ounce.
Gold and silver markets are seeing bargain hunters step in to buy the recent dip in prices amid a “risk on” attitude in the market place Thursday. The European Union sovereign debt crisis finds some positive developments Thursday. There are reports the Greek private sector/government debt swap arrangement agreed upon recently is going smoothly. Thursday is the deadline for the swap arrangements to be completed. European stock markets and the Euro currency are higher, and EU country bond yields are lower Thursday, following the more upbeat Greek news. However, once the present Greek hurdle is cleared market place attention will turn to other EU trouble spots, such as Portugal. The overall EU debt crisis remains a major underlying bullish factor for safe-haven gold.
The U.S. dollar index is trading lower Thursday morning, which is supportive for the precious metals. Meantime, Nymex crude oil futures prices are trading higher Thursday, which is also a positive factor for gold and silver. The U.S. dollar index and crude oil will remain two important outside market forces that will have a daily impact on the precious metals markets.
U.S. economic data due for release Thursday includes the Challenger job cut report and the weekly jobless claims report.
Traders are awaiting the key U.S. jobs report on Friday. Look for a more active trading day in the market place on Friday, in the wake of the jobs report. The key non-farm payrolls figure of the employment report is expected to rise by just over 200,000 in February.
The London A.M. gold fixing was $1,682.50 versus the previous London P.M. fixing of $1,669.00.
Technically, gold futures bulls still have more work to do to fully recover from the recent downside price action that did produce near-term technical damage. The bulls’ next upside price breakout objective is to produce a close above solid technical resistance at $1,727.30. Bears’ next near-term downside price objective is closing prices below solid chart support at $1,650.00. First resistance is seen at the overnight high of $1,704.80 and then at this week’s high of $1,718.00. First support is seen at the overnight low of $1,683.60 and then at Wednesday’s low of $1,671.70.
May silver futures bulls still have more work to do in the near term to regain upside technical momentum. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $35.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $32.00. First resistance is seen at the overnight high of $34.185 and then at $34.50. Next support is seen at the overnight low of $33.36 and then at $33.00.
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