Gold And Silver Prices Are Lower- As They Get Scant Help From Oil
New York (Sept 29) Gold prices are steady to slightly lower in early U.S. dealings Thursday. A spike in crude oil prices Wednesday afternoon was only slightly supportive for the precious metals markets. December Comex gold was last down $0.40 an ounce at $1,322.90. December Comex silver was last down $0.016 at $19.11 an ounce.
Crude oil rallied following the surprise news Wednesday afternoon that the OPEC oil cartel, at its meeting in Algiers, reached a preliminary agreement to reduce its collective oil production by a bit less than 1 million barrels a day. The deal will be finalized at OPEC’s November meeting. Most energy market watchers did not believe OPEC would make any significant moves to reduce their crude oil output at this meeting. Nymex crude oil futures prices initially spiked about $2.00 higher Wednesday afternoon on the news. Oil prices Thursday had backed off a bit, as some in the energy industry are still skeptical a final agreement will be reached in November, saying that Iran and Saudi Arabia will not work together to cut oil output. World markets have been extra-sensitive to crude oil’s daily price movements recently.
World stock markets were lifted overnight on the OPEC news, giving the marketplace a “risk-on” attitude that is bearish for the safe-haven gold market. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the advance economic indicators report, the final gross domestic product report for the second quarter, and pending home sales.
Technically, December gold futures bulls have the overall near-term technical advantage but are fading this week. Bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the September high of $1,357.60. Bears' next near-term downside price breakout objective is closing prices below solid technical support at $1,300.00. First resistance is seen at Wednesday’s high of $1,331.10 and then at $1,340.00.
December silver bulls have the slight overall near-term technical advantage, but have faded recently. Silver bulls’ next upside price breakout objective is closing futures prices above solid technical resistance at the September high of $20.235 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the August low of $18.46. First resistance is at the overnight high of $19.46 and then at Tuesday’s high of $19.61.