Gold hit a fresh two-week high on Thursday with solid gains from a weakened US dollar and firmer oil prices. The financial crisis in the European Union is becoming a main concern once again as another weak EU economic report was issued.
By Jim Wyckoff Of Kitco News
4/26/2012 @ 2:49PM
Comex gold futures prices ended the U.S. day session with solid gains Thursday—near the session high and hitting a fresh two-week high. Short covering and bargain-hunting buying interest following recent selling pressure were featured. A weakening U.S. dollar index and firmer crude oil prices were also supportive for the precious metals markets. June gold last traded up $18.90 at $1,661.20 an ounce. Spot gold was last quoted up $16.30 an ounce at $1,661.00. May Comex silver last traded up $0.854 at $31.21 an ounce.
The U.S. dollar index traded steady to weaker Thursday and hit a fresh three-week low. The greenback bulls are fading and that is encouraging to the precious metals bulls. Meantime, crude oil futures prices traded firmer Thursday, as the crude bulls are gaining some fresh upside technical momentum. That’s also supporting the gold and silver markets.
There were no major fresh developments coming out of the European Union and its sovereign debt and financial crisis Thursday. There was another weak EU economic report issued. Still, the EU debt debacle appears to be gradually creeping back to the front burner of the market place. The EU is in economic recession, which makes getting its debt problems under control a very difficult proposition. Look for the EU debt crisis to be back in the headlines soon. It’s still my bias that any significant escalation in the EU debt crisis would be bullish for the safe-haven gold market.
The London P.M. gold fixing was $1,653.50, compared to the previous London P.M. fixing of $1,637.75.
Technically, June gold futures prices closed nearer the session high and hit a fresh two-week high Thursday. Gold bears still have the slight overall near-term technical advantage. Prices still are in a two-month-old downtrend on the daily bar chart. However, the bulls would gain fresh upside near-term technical momentum by producing a bullish weekly high close on Friday. The gold bulls’ next upside price breakout objective is to produce a close above solid technical resistance at the April high of $1,685.40. Bears’ next near-term downside price objective is closing prices below technical support at the April low of $1,613.00. First resistance is seen at Thursday’s high of $1,662.00 and then at $1,675.00. First support is seen at $1,650.00 and then at Thursday’s low of $1,642.50. Wyckoff’s Market Rating: 4.5.
May silver futures prices closed near the session high Thursday. Prices are still in a two-month-old downtrend on the daily bar chart. The silver bears still have the near-term technical advantage. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $32.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $29.00. First resistance is seen at Thursday’s high of $31.26 and then at $31.50. Next support is seen at Thursday’s low of $30.595 and then at this week’s low of $29.925. Wyckoff’s Market Rating: 4.0.
May N.Y. copper closed up 725 points 377.25 cents Thursday. Prices closed near the session high and saw more short covering and bargain hunting. The key “outside markets” were in a bullish posture for copper Thursday as the U.S. dollar index was weaker and crude oil prices were firmer. Copper bulls gained some fresh upside technical momentum today and are on a level near-term technical playing field with the bears. Copper bulls’ next upside breakout objective is pushing and closing prices above solid technical resistance at 380.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at the April low of 356.90 cents. First resistance is seen at today’s high of 377.45 cents and then at 380.00 cents. First support is seen at 375.00 cents and then at 372.50 cents. Wyckoff’s Market Rating: 5.0.
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