Gold Drops To 4-Wk. Low Amid Surging U.S. Dollar

(Kitco News) – Gold prices are modestly down and hit a four-week low in early U.S. trading Monday, pressured by a very strong U.S. dollar on the foreign exchange market. Silver prices are also slightly down and hovering near a two-month low. December gold futures were last down $2.70 an ounce at $1,205.90. December Comex silver was last down $0.05 at $14.09 an ounce.

Global stock markets were mixed overnight, with European shares mostly weaker and Asian shares mostly firmer. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins.

China’s stock market did post a modest rebound Monday as Alibaba’s “singles day” sale saw Chinese consumers buy $30.8 billion in goods on-line Sunday. That beat last year’s 24-hour total of $25.3 billion.

The U.S. government is closed today for the Veterans Day holiday.

The key “outside markets” today find the U.S. dollar index solidly higher and hitting a 16-month high overnight. The Euro currency hit a 16-month low against the greenback.

Meantime, Nymex crude oil futures prices are firmer and trading around $60.50 a barrel after hitting a seven-month low on Friday. Reports today say Saudi Arabia will cut its oil exports and prod the OPEC oil cartel to lower its collective crude oil production, in the wake of the recent steep downdraft in oil prices.

There is no major U.S. economic data due for release Monday, due in part to the federal holiday.

Technically, gold bears have the overall near-term technical advantage. Bulls’ next upside price objective is to produce a close in December futures above solid resistance at the October high of $1,246.00. Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at $1,200.00. First resistance is seen at the overnight high of $1,212.00 and then at $1,220.00. First support is seen at $1,200.00 and then at $1,190.00. Wyckoff’s Market Rating: 3.0

December silver futures bears have the solid overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $15.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the September low of $13.965. First resistance is seen at Friday’s high of $14.425 and then at last week’s high of $14.775. Next support is seen at the September low of $13.96 and then at $13.75. Wyckoff’s Market Rating: 2.0.

By Jim Wyckoff
For Kitco News


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