Gold Price And Silver Down On Firmer US Dollar, Profit Taking
San Francisco (Jan 19) Gold and silver prices ended the U.S. day session lower Thursday, on downside corrections and some profit taking following recent good gains that have seen both markets hit two-month highs this week. A rally in the U.S. dollar index on this day was also a negative for the precious metals markets. Still, both gold and silver remain in near-term price uptrends. February Comex gold was last down $11.60 an ounce at $1,200.50. March Comex silver was last down $0.299 at $16.975 an ounce.
The U.S. dollar index saw another corrective bounce Thursday following sharp losses on Tuesday that saw the index hit a four-week low. Fed Chair Janet Yellen in a speech Wednesday sounded hawkish, saying the Federal Reserve is likely to raise U.S. interest rates a few times in the next couple years, to ward off inflationary price pressures.
The other key “outside market” on Thursday saw Nymex crude oil prices trading higher. The International Energy Agency reported Thursday that OPEC appears to be cutting back its collective production, as it said it would do. There remain stiff technical chart resistance layers that lie just above the crude oil market.
The conclusion of the European Central Bank’s regular monetary policy meeting Thursday saw no change in monetary policy, as expected. As usual, focus was on ECB President Mario Draghi’s press conference after the meeting. Draghi sounded a dovish tone on EU monetary policy, which further helped to lift the U.S. dollar today, and in turn put some more downside pressure on the metals markets.
The world marketplace remains a bit anxious as Donald Trump is set to be inaugurated as the next U.S. president in less than 24 hours. Trump’s stated ambitious economic growth plans have so far lacked specifics, which is worrisome to many market watchers. Trump has also made remarks that have ruffled the feathers of top Chinese government officials. China is the world’s second-largest economy.
Technically, February gold futures prices closed near mid-range. Prices Tuesday hit a seven-week high. The gold bulls and bears are still on a level overall near-term technical playing field. Prices are in a four-week-old uptrend on the daily bar chart. That suggests prices can continue to trend sideways to higher in the near term. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,225.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,175.00.
Source: KitcoNews
