Gold & Silver Daily Market Recap: December 7th, 2012

Positive U.S jobs data had spot gold whipsawing in the early part of the session. The metal dropped to $1684.10 immediately after the release of the U.S nonfarm payrolls as the dollar rally gained steam.

More encouraging signs the U.S economy recovery is gaining traction as the US added a surprising 146,000 jobs last month, beating the projected 89,000 forecast.  The unemployment rate fell to 7.7% from 7.9%. The only mild disappointment was the October number was revised down to 138,000, from the initially reported 171,000 figure and September figure was lowered to 132,000 from 148,000. The main reason for the immediate sell off was the fear that traders have that a strong healthy economy could put an end to QE3 earlier than anticipated.

On the Eurozone, a pessimistic outlook by ECB president Mario Draghi sent the euro sharply lower. The single currency had been holding around the 1.3100 level and looked poised to challenge resistance at 1.3180 but Draghi's downbeat comments set traders to sell the currency. Draghi said...... "The Governing Council continues to see downside risk to the economic outlook for the euro area. These are mainly related to uncertainties about the resolution of sovereign debt and governance issues in the euro area" Despite the negative outlook, spot gold rallied in the face of the Euro dollar sell off.

“Despite the ECB’s growth and inflation downgrades yesterday, we still feel that their view is not pessimistic enough. Consequently, we expect that an interest rate cut cannot be too far off. Such a move would be a positive for pressures metals, in particular gold, and affirm the developed world’s mostly accommodative monetary stance that remains a key factor in our persistently bullish view on gold,” Standard Bank said in its daily note.

Spot silver enjoyed some success holding key support at $32.50. The grey metal has held up quite well but over head resistance remains an issue. A good clear break of $33.25 should bring in more buyers.

The year is coming to an end and the markets have been focusing on the next major problem. The fiscal cliff will most definitely help keep the markets volatile. But the ongoing uncertainty and the printing presses will continue to be dominant factors affecting the markets. The precious metals know inflation is just around the corner with the Fed’s ongoing record stimulus. Precious metals are witnesses to the uncertainty and fear. Precious metals have been and will always be that safe haven, expect the price to remain buoyant to the year end with good buying remaining prevalent on dips.

  Gold Silver
Support $1662/$1685 $32.05/$32.50
Resistance $1705/$1717 $33.30/$34.25


 December 7th Closing Prices

Gold $1704
Silver $33.05
Platinum $1606
Palladium $697





  • United States Mint
  • Royal Canadian Mint
  • The Perth Mint Australia
  • Johnson Matthey
  • A-Mark Precious Metals, Inc.
  • Laurentian Bank
  • Engelhard
  • Brinks

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