Gold, Silver Prices Pop On Big U.S. Dollar Drop
(Kitco News) -Gold and silver prices are solidly higher in early U.S. trading Wednesday. Gold prices have scored a 4.5-month high. A sharply lower U.S. dollar index that slumped to a 3.5-year low today is providing the precious metals bulls with some rocket fuel. February Comex gold was last up $15.50 an ounce at $1,352.20. March Comex silver was last up $0.382 at $17.29 an ounce.
Helping to sink the U.S. dollar index Wednesday are comments from U.S. Treasury Secretary Steven Mnuchin, who said in Davos, Switzerland that a weaker U.S. dollar is beneficial for the U.S. economy.
Some upbeat economic data coming out of the European Union Wednesday helped to lift the Euro currency to a more-than-two-year high.
Meantime, Nymex crude oil prices are slightly higher, near $65.00 a barrel and not far below last week’s more-than-three-year high. The rally in the oil market is also an underlying bullish element for the precious metals markets.
U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the monthly house price index, the U.S. flash PMI, the U.S. services PMI, and the weekly DOE liquid energy stocks report.
Technically, February gold futures bulls have the firm overall near-term technical advantage. Prices are in a six-week-old uptrend on the daily bar chart. Bulls’ next upside technical objective is pushing and closing prices above chart resistance at the September high of $1,365.80. Bears' next near-term downside price breakout objective is closing prices below solid technical support at $1,324.30. First support is seen at $1,345.00 and then at today’s low of $1,339.10. First resistance is seen at today’s high of $1,353.50 and then at $1,360.00. Wyckoff’s Market Rating: 7.0
March silver bulls have the slight overall near-term technical advantage, amid the recent sideways trading. 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 this week’s low of $16.735. First resistance is seen at $17.32 and then at the January high of $17.45. Next support is $17.00 and then at $16.80. Wyckoff's Market Rating: 5.5.