Friday’s EU news lifted gold prices in a hurry but it appears that the $1,600 resistance level proved to be…resistant to further assaults for the time being. The yellow metal started the abbreviated trading week in profit-raking mode as did the rest of the precious metals’ complex.
Precious metals started the new week with mixed results this morning as the euro remained steady around $1.235 but remained at risk of sell-offs and as crude oil advanced by less than 1% on supply worries.
Gold moved $10 higher ahead of the ECB rate announcement and it once again neared the Monday high. Silver added $30 cents and traded just above the $35 level. Market participants continue to target the $1,800 and $35.50 closing levels in the gold/silver duo.
The big surprise this morning was that the US jobs figures…surprised to the upside, and then some. Gold prices promptly fell by as much as $18 (all the way back down to $1,682) in the wake of the report that showed US unemployment falling to 7.7%.
Whereas gold had opened in New York right around the pivotal $1,700 mark, Labor Department data sent the yellow metal some $20-25 lower, and to a low of $1,675 per ounce, within the first hour after the figures were released.
CFTC reports continue to show that net long positions in gold are being liquidated. Nineteen tonnes were shed in the latest reporting period on Comex. Long-silver specs unloaded 210+ tonnes from their logbooks and added 110+ tonnes to short positions.
Another day of substantial selling in the precious metals complex brought gold prices right back to the $1,550 value zone, raising legitimate questions about whether the numerous calls of a bottom occurring last week were perhaps premature.
Spot gold fell to lows near $1,587 and then opened at $1,596, down $7 while silver touched $27.25 per ounce overnight but opened at $27.52. Once again, the US dollar added a few small steps to yesterday’s upward march and reached 82.85 on the index.
The metals markets opened to the downside for the midweek session this morning. A 0.28% advance in the US dollar and a 0.36% slip in crude oil contributed to early selling pressure. Spot gold prices dipped under Tuesday’s lows and touched $1,588 per ounce.
The markets are presenting us with more post-Fed “leftovers” this morning as well. Spot metals dealings opened flat-to-slightly-higher in New York as Tuesday’s sessions got underway. Gold drifted near $1,775 and silver appeared stalled around $34 per ounce.