Gold, Silver Hit 4-Wk Highs On Bullish Technical Momentum
(Kitco News) - Gold and silver markets are steady to slightly up in early U.S. trading Wednesday, and hit new four-week highs overnight. The precious metals bulls have gained technical momentum amid their fledgling price uptrends on the daily charts, which is inspiring more chart-based buyers to step in on the long side. February Comex gold was last up $0.50 an ounce at $1,288.00. March Comex silver was last up $0.066 at $16.67 an ounce.
It’s been a quiet trading and news week, so far, as many traders and investors are out this week for the holiday season. This is allowing technical considerations to have more daily influence on gold and silver prices, amid the lack of fresh fundamental news.
The key outside markets on Wednesday morning find the U.S. dollar index weaker and hitting a four-week low overnight. Nymex crude oil prices also lower on the day, on a corrective pullback after hitting a 2.5-year high on Tuesday. An oil pipeline explosion in Libya helped to fuel the rally in crude prices Tuesday.
U.S. economic data due for release Wednesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the consumer confidence index, and pending home sales.
Technically, February gold futures bulls and bears are on a level overall near-term technical playing field, but the bulls have momentum on their side. Prices are in a steep, two-week-old uptrend on the daily bar chart. Bulls’ next upside technical objective is pushing and closing prices above chart resistance at $1,300.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at the December low of $1,238.30. First support is seen at Tuesday’s low of $1,277.70 and then at $1,268.40. First resistance is seen at the overnight high of 1,291.10 and then at $1,300.00. Wyckoff’s Market Rating: 5.0
March silver bears still have the slight overall near-term technical advantage. However, recent gains suggest a market bottom is in place. The next upside price breakout objective is closing futures prices above solid technical resistance at $17.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $16.00. First resistance is seen at $16.75 and then at $17.00. Next support is seen at the overnight low of $16.555 and then at Tuesday’s low of $16.365. Wyckoff's Market Rating: 4.5.