Gold, Silver Prices Retreat Amid Rebound In U.S. Dollar
(Kitco News) - Gold and silver prices are weaker in early U.S. trading Tuesday. A rebound in the U.S. dollar index early this week is providing downside price pressure on the gold and silver markets. Some normal profit-taking and chart consolidation are also featured after gold prices hit a 3.5-month high last week. February Comex gold was last down $5.50 an ounce at $1,314.90. March Comex silver was last down $0.094 at $17.05 an ounce.
World stock markets were mostly firmer in overnight dealings. U.S. stock indexes are pointed toward firmer openings when the New York day session begins. The U.S. indexes poked to new record highs again overnight. There continues to be little risk aversion in the world marketplace, at present, and that’s a negative element for the safe-haven gold and silver markets.
The key outside markets on Tuesday morning see the U.S. dollar index higher on another corrective bounce from recent selling pressure. While the greenback bears still have the overall near-term technical advantage, the bulls are out of the shoot in good fashion so far this week.
Meantime, Nymex crude oil prices are firmer and hit a three-year high of $62.56 a barrel overnight. Traders are waiting to see if the U.S. implements new economic sanctions against Iran, which could limit their oil exports. The recent rally in oil prices has been a positive development for the precious metals markets.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and Goldman Sachs retail sales reports, the NFIB small business index, the IDB/TIPP economic optimism index, and the World Bank’s global economic prospects report.
Technically, February gold futures bulls have the overall near-term technical advantage. Prices are in a four-week-old uptrend on the daily bar chart. Bulls’ next upside technical objective is pushing and closing prices above chart resistance at $1,350.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at $1,300.00. First support is seen at $1,312.70 and then at $1,307.10. First resistance is seen at today’s high of $1,321.40 and then at last week’s high of $1,327.30. Wyckoff’s Market Rating: 6.0
March silver bulls have the overall near-term technical advantage. Prices are still in a four-week-old uptrend on the daily bar chart. The next upside price breakout objective is closing futures prices above solid technical resistance at the October high of $17.59 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the October low of $16.435. First resistance is seen at last week’s high of $17.32 and then at $17.50. Next support is seen at $17.00 and then at $16.865. Wyckoff's Market Rating: 6.0.