Gold and Silver finished the week mixed as December gold settled 1274.9 down $9.90, while December silver settled at 16.79 up 11.5 cents for the week. Gold slid to two-month lows on Friday before bouncing back to post modest gains for the day. An upbeat reading of the U.S. unemployment rate and wage growth last month supported expectations for a further U.S. interest rate hike in December, pushing the dollar and Treasury yields higher. Traders looked past data showing the first drop in U.S. employment in seven years as other indicators suggested the jobs market was improving. The Department of Labor said that the United State lost 33 K jobs last month marking the first contraction in the labor market since September 2010. The average trade guess prior to the report was for a gain of 90 K jobs. Gold prices have fallen more than 1 percent this week and are facing their fourth straight week of declines, the metal’s longest run of weekly losses this year. Investor interest in gold has been soft. Holdings of the world’s largest gold-backed exchange-traded fund, Spider Gold Shares, have fallen 13.6 tonnes so far this week, their first weekly outflow in nine weeks and the largest since late July. Demand for physical gold in India improved slightly this week because of a correction in local prices, but restrictions on the industry and increased smuggling took the sheen off the gold market heading into the peak festival season.
Technically gold and silver have erased early daily losses that pushed prices to two-month lows, in late-morning trading Friday. The greenback has backed down from its session high and the U.S. stock indexes are also weakening, which has prompted metals traders to do some short-covering in the futures markets, and a bit of bargain buying in the cash markets, heading into the weekend. December gold made a weekly low at 1262.8, while silver probed all the way down to 1634.5 following this mornings non farm payroll release. The move in silver looks like an intra-day reversal as it finished over 40 cents from the daily low while posting a higher close for the week. There was some noise about another potential missile launch this weekend by North Korea so in my view there was definitely some safe haven buying into the weekend. My technical swing numbers for next week come in as follows. For December gold, support is down at 1263.4 and with a close below 1252.0 is next. Resistance is up at 1285.6 and with a close over 1296.4 is next. For December silver support is down first at 16.45 and below there at 16.11. Resistance is up at 17.02 and then up at 17.26.
For those interested I hold a weekly webinar each Thursday at 3 pm. Signup is free and a recording link will be sent upon signup.