Morning Gold Fix – November 2, 2011
FMX | Connect – www.fmxconnect.com - (Reported 11/2/2011)
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 $1,711.50 per troy ounce on Tuesday, a loss of $13.40 for the day.
December gold was up $20.0 to $1731.8 per 100 troy ounces as of 8:35 am EST this morning. The December U.S. dollar index was down 0.325 to $77.065. January platinum was up 23.0 to $1605.0 per 50 troy ounces. December silver was up 111.9 cents to 33.850.
Market Recap
Gold slipped lower on Tuesday, broadsided by news that Greek prime Minister George Papandreou would be putting the latest EU rescue plan to a public referendum. The Federal Open Market Committee began a meeting that will conclude tomorrow.
Volatility was sharply higher, suffused by a fresh wave of European distress. In early trading, puts were bid, both as outrights and in spread form. Both futures and options saw increased volumes from Monday, and more interest in back-dated options. While there was plenty of speculative activity in both calls and puts in December, today saw a variety of opinions across the term structure, including the purchase of both the April 1700/1550 1x2 Put Spread and the June 1800/2300 Call Spread. As the day wore on, gold gradually drifted back to yesterday’s levels. Futures were trading above 1720 approaching the Globex close.
Market Prices
In the News
Bloomberg (Reported 11/2/2011)
The most accurate forecasters say gold will rebound from its biggest monthly plunge since 2008 and reach a record by March because economic growth is stagnating and Europe’s debt crisis is unresolved. Futures traded in New York may rise 12 percent to $1,950 an ounce by the end of the first quarter, according to the median of estimates compiled by Bloomberg. The predictions are from eight of the top 10 analysts tracked by Bloomberg over the past eight quarters. Two declined to give forecasts. Top Gold Forecasters See Bullion Rallying to Record by March: Commodities
Reuters (Reported 11/2/2011)
Gold firmed on Wednesday, helped by safe-haven demand as the euro zone troubles deepened and business surveys showed the severe impact the crisis had on manufacturing in the region. A recovering euro, which rebounded from a three-week low against the dollar, also helped underpin the precious metal. Greece's Prime Minister George Papandreou shocked markets on Tuesday with a call for a referendum on a European Union 130 billion euro bailout package. Gold rises on deepening euro zone crisis
Kitco (Reported 11/2/2011)
Greece will hold a referendum on whether to implement last week’s EU bailout package for that beleaguered nation. This has once again unnerved the market place. Given the Greek public’s overt displeasure for austerity measures, most believe any referendum may not support a bailout package. This has once again put the EU debt crisis back on the front burner of the market place this week. If the EU debt crisis once again escalates to the downside, I suspect gold prices would continue to be supported on safe-haven investor demand. Comex Gold Higher on Bargain Hunting, Safe-Haven Demand
Technical Overview DEC GOLD
The market remains in a short term upturn, still within the larger flagging congestion of the past month. Trade is poised for further rally attempts and a close over 1750-1754 signals for a run to 177520* weekly resistance. Be prepared for near term congestion to again test for support along 1700- the next 1-2 days. A penetration under 1682 is negative, but only a close under 166170* marks a reversing turn back to bearish trade.
DEC SILVER
The market is remains in a short term bull upturn. A surge back over last week’s high should spark a bull leg reaching for 3700. this week’s pullback alerts for additional defensive flagging consolidation for a few days and may again test key 32135* support. A close under 32135* marks a turn back to negative trade in the 3200-3000 zone. If trade holds off 32135* today-Thursday, then suspect a climb back to friendly trade.
DEC COPPER
The market is showing a head and shoulders bottoming upturn and targets additional bull moves to 390-385. Be alert for weekly resistance to top the drive up against 395. Near term flagging dips are consolidating gains and testing for support in the mid 340’s. A bounce from the mid-low 340’s is bullish. A close under 33055* is needed to mark a turn back to bearish trade.
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