Morning Gold Fix – September 29, 2011
FMX | Connect – www.fmxconnect.com - (Reported 9/29/2011)
The following is a summary of yesterday’s US gold activity and a recap of Asia & European markets overnight. It includes our proprietary options analytics and news stories from industry professionals.
Summary
December Gold settled at $1,618.10 per troy ounce on Wednesday, a loss of $34.40 for the day.
December gold was down $2.5 to $1615.6 per 100 troy ounces as of 8:20 am EST this morning. The Dec U.S. dollar index was up 0.067 to $78.095. October platinum was down 8.2 to $1526.0 per 50 troy ounces. Dec silver was down 6.4 cents to 31.345.
Market Recap
After trading sideways much of the day, Gold prices dropped abruptly mid-day, undercut by a surging dollar and cross-commodity selling. Volatility and puts were bid on fears of an imminent washout and calls above the market continue to be sold vociferously. December was particularly active, with more than 10,000 of the 1880 Calls being sold, first in the 1810/1880 1x2 Call spread and later in butterfly form with the addition of the 1930 Call. Calls were also sold via a February 1800/2000/2050 Call tree. November and December puts were bid, with speculators taking an interest in the 1500 strike. On the day volatility was 1-2% higher across the term structures, and fences traded toward the puts.
Market Prices
In the News
Bloomberg (Reported 9/29/2011)
Gold may fall for a second day in New York as investors sell the metal to cover losses in other assets and after Germany moved to help prevent Europe’s debt woes from worsening. Germany’s lower house of parliament approved the expansion of a bailout fund for debt-stricken euro-area nations to help contain the sovereign-debt crisis. Gold this week slipped below $1,600 an ounce for the first time since July as commodities fell to this year’s low and global equities traded near the lowest since July 2010. Gold Gains as EU Crisis Spurs Haven Demand
Reuters (Reported 9/29/2011)
Gold rose on Thursday, lifted by strong physical demand and gains in the euro, but was back from earlier highs as the German parliament's approval of new powers for the euro zone rescue fund damped interest in the metal as a haven from risk. Spot gold was up 0.2 percent at $1,611.49 an ounce at 1152 GMT (7:52 a.m. EDT). Earlier it rose as high as $1,633.59 on talk that German Chancellor Angela Merkel could face dissent in her own party in the rescue fund vote, but eased as this dissipated. Gold firms on physical demand, stronger euro
Kitco (Reported 9/29/2011)
Comex December gold futures prices are trading around unchanged to slightly lower levels Thursday morning. Firmer U.S. and European stock indexes are pulling some investment demand away from the precious metals Thursday morning. Comex Gold Trading Steady-Weak amid Better Risk Appetite in the Market Place
Technical Overview
DEC GOLD
Overall the market is bearish, but near term trade is still in a correction off the 1560 target and may yet consolidate the sharp downturn. If trade holds near 159010*, be ready for modest rallies back over 1650+. However, residual bear forces should blunt retracements and use congestion to setup for another selloff. A close over 171590* is needed for a bull turn. Sustained action under 159010* is negative and closes under 1560/154850 will extend declines.
DEC SILVER
The market is bearish, but holding over 28085* monthly support. The rebound from under 28085* still alerts for an extreme spike low and recovery action. A close over 3308 will boost retracements to test 3519*. Bear trend forces are likely prompting secondary dips. Closes under 2899* and 28085* should each help rekindle bear trending trade.
DEC COPPER
The market is still bearish with trade suggesting a secondary break to test target levels at 315- 310. A press under Monday’s low alerts for selling to 300-. A close under 296 is bearish. We may see a swing back to corrective congestion at 320-340. However, a close over 35115* is needed to motivate sustained corrections.
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