Gold Sees Solid Gains Amid Safe-Haven Buying, Bullish “Outside Markets”By Jim Wyckoff of Kitco News
Tuesday January 31, 2017 12:49
(Kitco News) - Gold prices were seeing strong gains in late U.S. trading Tuesday. Safe-haven demand amid some world stock market jitters just recently is featured in gold early this week. Meantime, silver futures pushed to a 2.5-month high today as the bulls have gained fresh technical strength. Both gold and silver futures markets so far this week are seeing short covering from the shorter-term traders. April Comex gold was last up $16.10 an ounce at $1,212.20. March Comex silver was last up $0.358 at $17.515 an ounce.
The world marketplace is still uneasy regarding executive moves the new U.S. president has made. President Donald Trump on Monday fired the acting U.S. attorney general when she refused to support his immigration ban. This seemingly growing uncertainty, including related world stock market weakness, is a bullish element for the safe-haven gold market.
The key “outside markets” were bullish for the precious metals markets Tuesday. The U.S. dollar index was sharply lower, partly on remarks today from Trump that suggested he wants to see a devalued U.S. dollar to better serve U.S. trade with other countries. Recent selling pressure in the dollar index has produced technical clues it has put in a near-term market top. The dollar index is in a near-term price downtrend.
Meantime, Nymex crude oil prices were firmly higher Tuesday. Trading in crude oil has been choppy in recent weeks.
The Federal Reserve’s FOMC meeting began Tuesday morning and ends Wednesday afternoon with a statement. No change in U.S. interest rates or monetary policy is expected. However, the wording of the statement will be closely scrutinized for clues regarding the future path of monetary policy. I look for the Fed statement to be fairly low key, as the Fed does not want to inject more uncertainty into an already jittery world marketplace.
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Technically, April gold futures prices closed nearer the session high today. The gold bears still have the overall near-term technical advantage, but the bulls have gained some upside momentum early this week. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at the January high of $1,223.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at last week’s low of $1,182.60. First resistance is seen at today’s high of $1,217.40 and then at $1,223.00. First support is seen at $1,200.00 and then at today’s low of $1,195.60. Wyckoff's Market Rating: 4.0
March silver futures prices closed nearer the session high and hit a 2.5-month high today. The silver market bulls and bears are now back on a level overall near-term technical playing field. However, the bulls have momentum on their side. Prices are in a six-week-old uptrend on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $18.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $16.50. First resistance is seen at today’s high of $17.635 and then at $17.75. Next support is seen at $17.36 and then at today’s low of $17.105. Wyckoff's Market Rating: 5.0.
March N.Y. copper closed up 715 points at 272.70 cents today. Prices closed nearer the session high and hit a nine-week high today. The key “outside markets” were in a bullish posture for copper today as the U.S. dollar index was sharply lower and crude oil prices were solidly higher. The copper bulls have the solid overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the November high of 275.30 cents. The next downside price objective for the bears is closing prices below solid technical support at 255.00 cents. First resistance is seen at 275.30 cents and then at 277.50 cents. First support is seen at 270.00 cents and then at today’s low of 265.95 cents. Wyckoff's Market Rating: 8.0.