Kitco Metals Roundup: Comex Gold Higher on Short C A.M. Kitco Metals Roundup: Comex Gold Higher on Short Covering, Bargain Hunting, Bullish Outside Markets
Friday July 13, 2012 8:02 AM
Comex gold futures prices are solidly higher Friday morning as traders are buying the recent dip in prices and doing some short covering and bargain hunting. Trading remains choppy and sideways on the daily chart. The key outside markets are mildly bullish for the precious metals so far Friday, as the U.S. dollar index is slightly weaker and crude oil prices are firmer. August gold last traded up $17.40 at $1,582.70 an ounce. Spot gold was last quoted up $10.60 an ounce at $1,583.25. September Comex silver last traded up
.194 at $27.35 an ounce.
It’s a mildly “risk-on” trading day in the market place early Friday. In overnight news, Chinese second-quarter GDP data showed weakness, but the data was in line with market expectations. China’s annual growth rate was pegged at 7.6% in the second quarter—the slowest growth rate in three years. This has raised speculation China will again ease its monetary policy, which is a bullish underlying factor for the commodity markets. Asian stocks did rise on the China GDP news, as it was not worse than the market place expected.
In other news, Moody’s on Friday downgraded Italy’s sovereign bond rating. Still, the latest auction of Italian three-year government debt saw decent demand, suggesting the EU debt crisis has for the moment stabilized.
The U.S. dollar index is slightly lower in early trading, on some profit taking after hitting a fresh six-week high on Thursday. The greenback bulls still have some upside near-term technical momentum. Meantime, Nymex crude oil futures prices are firmer. Trading in crude has turned choppy, but there are still some early clues the crude oil market has put in a bottom.
The London A.M. gold fix is $1,579.00 versus the previous London P.M. fixing of $1,556.25.
U.S. economic data due for release Friday includes the Producer Price Index and the University of Michigan consumer sentiment survey.
Technically, August gold futures bulls and bears are fighting for near-term technical control, with neither gaining much of an edge, as seen by the recent choppy and sideways trading range on the daily bar chart. The gold bulls’ next upside price breakout objective is to produce a close above psychological resistance at $1,600.00. Bears' next near-term downside price objective is closing prices below solid technical support at $1,547.60. First resistance is seen at the overnight high of $1,587.40 and then at $1,600.00. First support is seen at $1,575.00 and then at the overnight low of $1,565.5