Gold modestly up in choppy trading, supported by big drop in USDX

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(Kitco News) - Gold pricesare mildly higher in midday trading Thursday, on a choppy and two-sided tradingday. Solid losses in the U.S. dollar index today are prompting some buyinginterest in the precious metals markets. A U.S. GDP report that was downbeatand which fell into the camp of the U.S. monetary policy doves, who want theFederal Reserve to hold off on tapering its monetary policy stimulus, was alsofriendly for the metals markets today. Decembergold was last up $4.40 at $1,803.00and December Comexsilver was last down $0.046 at $24.15 an ounce.

TheU.S. data point of the day saw the advance estimate for third-quarter grossdomestic product come in at up 2.0%, compared to expectations of up 2.8%,year-on-year and a 6.7% growth reading in the second quarter. The closelywatched PCE price index was reported at up 5.3%, compared to a rise of 6.5% inthe second quarter. The weaker GDP data was somewhat offset by the weekly U.S.jobless claims report that showed a decline.

Globalstock markets were mostly weaker in overnight trading. The U.S. stock indexesare solidly higher at midday, and that is limiting the upside in the safe-havenmetals. Trader and investor attitudes are upbeat this week, as they choose tofocus on positive corporate earnings reports. For the moment the marketplace isbrushing aside slowing economic growth in China, supply chain bottlenecks andrising inflation prospects.

TheEuropean Central Bank held its regular monetary policy meeting Thursday. Nochanges in ECB monetary policy were implemented and not were expected. The ECBdid say that its bond-buying program would continue until at least March of2022. In her press conference ECB President Christine Lagarde was expected to say the Euro zoneremains too weak for policy makers to pull back stimulus. Meantime, Canada'scentral bank on Wednesday ended its quantitative easing program.

TheWorld Gold Council reported gold demand in the third quarter declined 7%compared to Q3 2020. Outflows from gold-backed ETFs were the primary factor.Increasing jewelry demand did mitigate the slide in demand, said the WGC. Goldjewelry demand grew 33%, year-on-year. Meantime, central banks purchased 69metric tons for reserves vs 10 MT in same period in 2020.

Thekey outside markets today see the U.S. dollar index sharply down and hitting afour-week low. Crude oil prices are lower and trading around $81.75 a barrel.Meantime, the 10-year U.S. Treasury note yield is presently fetching1.556%.

Technically,December gold futures bulls have the overall near-term technical advantage amida four-week-old price uptrend in place on the daily bar chart. Bulls' nextupside price objective is to produce a close above solid resistance at theSeptember high of $1,836.90. Bears' next near-term downside price objective ispushing futures prices below solid technical support at $1,750.00. Firstresistance is seen at today's high of $1,812.70 and then at the October high of$1,815.50. First support is seen at today's low of $1,793.10 and then at this week'slow of $1,783.00. Wyckoff's Market Rating: 6.5

December silver futures bulls have the overallnear-term technical advantage. Prices are in a four-week-old uptrend on thedaily chart. Silver bulls' next upside price objective is closing prices abovesolid technical resistance at $25.00 an ounce. The next downside priceobjective for the bears is closing prices below solid support at $23.00. Firstresistance is seen at Wednesday's high of $24.33 and then at this week's highof $24.695. Next support is seen at this week's low of $23.905 and then at$23.615. Wyckoff's Market Rating: 6.0.

DecemberN.Y. copper closed up 540 points at 444.30 cents today. Prices closed nearerthe session high today and hit a three-week low early on. The copper bulls andbears are on a level overall near-term technical playing field. Copper bulls'next upside price objective is pushing and closing prices above solid technicalresistance at 465.00 cents. The next downside price objective for the bears isclosing prices below solid technical support at 420.00 cents. First resistanceis seen at 450.00 cents and then at this week's high of 456.85 cents. Firstsupport is seen at today's low of 435.25 cents and then at 430.00 cents.Wyckoff's Market Rating: 5.0.

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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