NEW YORK (Kitco News) -- One week after the Federal Open Market Committee (FOMC), gold futures prices are still hurting and ended the day lower on this first trading day of November. Gold prices hit a four-week low overnight. December gold finished Monday down $5.50 at $1,135.90 an ounce.
Pressuring the metal, is the perceived higher odds of a U.S. Federal Reserve interest rate hike in December, said Kitco Metals' Senior Technical Analyst, Jim Wyckoff in an interview with Kitco News on Monday. 'The gold and silver markets have been reeling since last week's hawkish FOMC statement,' he said.
Technically, Wyckoff explained, the gold bears have the near-term technical advantage as prices have been trending lower for the past two and one-half weeks. 'Prices Friday closed at a bearish weekly low close and hit a four-week low today. Bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,170.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at $1,100.00,' he said.
Adding to gold's downside pressure was weak economic data coming out of China Monday. The Caixin China manufacturing purchasing managers' index (PMI) rose to 48.3 in October from 47.2 in September. A reading below 50.0 suggests contraction in the sector.
'The news helped to pressure Asian stock markets and raw commodity futures prices, including gold, silver and crude oil. China is the world's largest raw commodity importer,' Wyckoff said.
On the silver front, December silver futures prices closed near mid-range. The silver market bulls still have the slight near-term technical advantage but need to show more power soon to keep it, Wyckoff said. December Comex silver was last down $0.127 at $15.44 an ounce.