(Kitco News) – Comex February gold futures prices are trading solidly higher in early U.S. dealings Friday. The market is seeing short covering and bargain-hunting, while trying to stabilize after the smack-down suffered on Wednesday and Thursday when prices hit a fresh nearly three-month low. February gold last traded up $24.40 at $1,601.60 an ounce. Spot gold last traded up $28.20 an ounce at $1,599.25. March Comex silver last traded up $0.616 at $29.89 an ounce. The precious metals are starting to see some bargain-hunting buying interest enter the market place following this week’s strong selling pressure. Many traders are still spooked, too, after gold traded down nearly $100.00 at one point Wednesday and then saw follow-through selling pressure on Thursday that did produce serious near-term technical damage. Barring any major flare-up in the European Union debt crisis or some other geopolitical surprise development, look for the precious metals and most other markets to quiet down and see low-volume trading until after the holidays. There are no major, fresh developments on the European Union debt crisis scene so far Friday. This has the U.S. dollar index trading slightly lower on some profit taking after hitting an 11-month high Wednesday. The dollar index bulls still have the solid overall near-term technical advantage, which is still a major bearish underlying factor for the precious metals markets. Crude oil prices are trading firmer Friday morning, which is also positive for the precious metals. However, crude oil was also pounded lower Wednesday and Thursday. The only major U.S. economic data due for release Friday is the consumer price index. The London A.M. gold fixing was $1,589.50 versus the previous P.M. fixing of $1,574.00. Technically, February gold futures Thursday and hit a nearly three-month low. Much of the selling pressure in gold this week has been weak long liquidation. Gold prices did fall below their 200-day moving average this week for the first time since 2009. Serious near-term chart damage has been inflicted recently. Prices are in an accelerating four-week-old downtrend on the daily bar chart. Bulls’ next upside technical breakout objective is to produce a close above solid technical resistance at $1,650.00. Bears’ next near-term downside price objective is closing prices below major technical support at the September low of $1,543.30. First resistance is seen at $1,625.50 and then at $1,650.00. First support is seen at the overnight low of $1,572.10 and then at this week’s low of $1,562.50. March silver futures hit a fresh 2.5-month low on Thursday and are seeing short covering Friday. Serious near-term technical damage has been inflicted this week. Silver prices have been trending lower in a choppy fashion for six weeks. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $31.00 an ounce. The next downside price breakout objective for the bears is closing prices below major technical support at the September low of $26.185. First resistance is seen at $30.00 and then at $30.50. Next support is seen at $29.50 and then at the overnight low of $29.12 and then at $29.00. Follow me on Twitter to immediately get the very latest market developments. If you are not on board, then you are not getting key analysis and perspective as fast or as often as you could! Follow me on Twitter to get my very timely intra-day and after-hours briefs on precious metals price action. The precious markets will remain very active. If you want market analysis fast, and in after-hours trading, then follow my up-to-the-second precious metals market perspective on Twitter. It’s free, too. My account is @jimwyckoff.

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