Mild downside price corrections in gold, silver Thursday

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(Kitco News) -Gold and silver prices are slightly lower in early U.S. trading Thursday, on normalcorrective pullbacks and light profit taking from the shorter-term futurestraders. A slumping crude oil market is also a bit worrisome to the raw commoditymarket bulls, including the metals markets bulls. December gold was last down $1.80at $1,868.40 and December Comex silver was last down $0.022 at $25.145 an ounce.

Globalstock markets were mostly down in overnight trading. The U.S. stock indexes arepointed to higher openings when the New York day session begins. The stockmarket bulls are keeping the major indexes buoyant amid upbeat corporate earningsreports. However, inflation worries continue on the rise. Rallies in many rawcommodity futures markets on Wednesday underscored notions that commercialend-users are already “stocking up” ahead of time, in order to beat perceived likelyfuture price increases. That only makes supplies shorter and more inclined toprice increases.

Thekey outside markets today see the U.S. dollar index weaker after hitting a15-month high on Wednesday. Nymex crude oil prices are slightly lower and tradingaround $78.25 a barrel. Oil prices overnight hit a six-week low as it appearsthe crude market has put in a near-term top. There is talk the U.S. and Chinamay tap their strategic oil reserves to help ease higher gasoline prices. The10-year U.S. Treasury note yield is presently fetching 1.58%.

U.S.economic data due for release Thursday includes the weekly jobless claimsreport, the Philadelphia Fed business survey, leading economic indicators, andthe Kansas City Fed manufacturing survey.

Technically,December gold futures bulls have the firm overall near-term technical advantageand have momentum. A six-week-old uptrend is in place on the daily bar chart. Bulls’next upside price objective is to produce a close above solid resistance at $1,900.00.Bears' next near-term downside price objective is pushing futures prices belowsolid technical support at $1,800.00. First resistance is seen at this week’shigh of $1,879.50 and then at $1,900.00. First support is seen at this week’slow of $1,851.00 and then at $1.839.00. Wyckoff's Market Rating: 7.0.

The silver bulls have the overall near-term technicaladvantage. Prices are in a six-week-old uptrend on the daily bar chart. Silver bulls'next upside price objective is closing December futures prices above solid technicalresistance at $26.13 an ounce. The next downside price objective for the bears isclosing prices below solid support at $23.00. First resistance is seen at thisweek’s high of $25.49 and then at $25.75. Next support is seen at this week’slow of $24.825 and then at $24.50. Wyckoff's Market Rating: 6.5.

By Jim Wyckoff

For Kitco News

Follow @jimwyckoffjwyckoff@kitco.comwww.kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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