Gold Up On More Safe-Haven Demand; Yellen On Deck
Tuesday February 14, 2017 08:16
(Kitco News) -Gold prices are higher in early U.S. trading Tuesday, on some more safe-haven demand and as traders stepped in to buy the recent dip amid a still-bullish near-term technical picture. Meantime, silver prices are higher and scored another three-month high overnight, with prices above $18.00. April Comex gold was last up $8.30 an ounce at $1,234.10. March Comex silver was last up $0.20 at $18.025 an ounce.
Some safe-haven demand for gold has surfaced again following the surprise resignation late Monday night of President Trump’s national security advisor, Mike Flynn. He made contradictory statements about his contacts with Russia, which reports said could have made him susceptible to blackmail by the Russians.
Focus Tuesday is on testimony from Fed Chair Janet Yellen before the U.S. Senate, in the semi-annual Humphrey-Hawkins reports. She will discuss the U.S. economy and monetary policy. The meeting begins at 10:00 a.m. eastern time. Traders and investors will glean her remarks for clues on the timing of the next U.S. interest rate increase, which could come as early as March. Most Fed watchers think the next rate hike from the Fed will come in June. Yellen will also likely be grilled on what she thinks about the Trump administration’s economic and fiscal policies.
The key “outside markets” on Tuesday morning find the U.S. dollar index trading lower. The greenback bulls still have some upside momentum as prices have been trending higher for two weeks. Meantime, Nymex crude oil prices are higher. Oil prices are back in a sideways trading range that has bound that market for weeks.
U.S. economic data due out Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the NFIB small business index and the producer price index.
(Note: Follow me on Twitter--@jimwyckoff--for breaking market news.)
Technically, April gold futures bulls have the overall near-term technical advantage. Prices are in a two-month-old uptrend on the daily bar chart. Bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,250.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at $1,200.00. First resistance is seen at $1,238.90 and then at last week’s high of $1,246.60. First support is seen at the overnight low of $1,225.90 and then at this week’s low of $1,220.30. Wyckoff’s Market Rating: 6.0
March silver bulls have the overall near-term technical advantage. Prices are in a seven-week-old uptrend on the daily bar chart and on Tuesday hit a three-month high. Silver bulls’ next upside price breakout objective is closing futures prices above solid technical resistance at $18.50 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $17.00. First resistance is seen at $18.25 and then at $18.35. Next support is seen at the overnight low of $17.81 and then at $17.545. Wyckoff's Market Rating: 6.0.