Gold & Silver Daily Market Recap: November 23rd, 2012

Precious metals gained on renewed hopes of a Greece resolution as Greece's lenders have decided on new ways to reduce its massive debt.

Spot gold gained 1% to trade as high as $1752 benefitting from a firmer euro. The single currency was rallying as optimism rose that a deal for Greece will be agreed on as early as Monday, and on reports of a bailout for Cyprus. The yellow metal broke through key resistance at $1742 which carried the metal higher.  Markets have been generally quiet heading into the U.S thanksgiving weekend but strong buying related to next Tuesday's expiration of the popular December COMEX options also lifted gold. Heavy positioning of the $1,750 and $1,800 strikes in call options could increase volatility and lift prices in the near term.

The U.S fiscal cliff issues seems to be making progress as the Democrats and the republicans have been making some progress with only 38 days left before the U.S could fall off the cliff. The U.S markets showed the enthusiasm for the resolution as U.S. stocks rose solidly on Black Friday, the unofficial start of the holiday shopping season. Retail is a key driver of the nation’s economy as consumer spending accounts for about 70 percent of U.S. economic activity.

China continues to be the x factor as the China November preliminary HSBC manufacturing PMI surprised to the upside  again at 50.4 compared to 49.5 in October. In the last two quarters, Chinese quarter-on-quarter real GDP growth has found some firm footing and has accelerated. Higher Chinese demand bodes well for higher gold demand in the coming months. China is now become the world's largest gold consumer.

Spot silver was the bigger winner in the light trading day. The dual role metal has surged to a one month high of $34.18 on the heels of positive Chinese data. The metal has closed positively for the week above its 50-day MA this week generally considered a buy signal which could encourage bulls to add to their long positions in the coming weeks.

Precious metals have finally broke from the range bound trading we have witnessed. Gold surged 1% which leading into the final month of the year bodes well for more buying. The beginning of December brings some important U.S data reports which will definitely be the main driver of the metals.

 November 23rd Closing Prices