Gold Prices Gain, Hit 5-Wk. High, On Safe-Haven, Technical Buying
(Kitco News) - Gold prices are moderately up and have scored a five-week high in early-afternoon U.S. trading Tuesday. Silver prices are also firmer and hit a three-week high today. The safe-haven metals are getting buying support from a big sell-off in the U.S. stock market today. The gold market is also benefiting from an improved near-term chart posture that is inviting technical buyers. Currently, gold prices are in an uptrend on the daily bar chart. February gold futures were last up $5.40 an ounce at $1,245.00. March Comex silver was up $0.156 at $14.65 an ounce.
World stock markets were also mostly lower overnight. The initial trader and investor euphoria over a U.S.-China trade dispute cease-fire for 90 days rapidly dissipated. The marketplace quickly realized “the devil is in the details” on getting this matter resolved. The matter will likely continue to produce uncertainty in markets, with comments from U.S. and China government officials continuing to tweak the markets—just like was the case before the meeting between Presidents Trump and Xi last weekend.
A feature in the marketplace just recently is falling U.S. Treasury yields (rising prices). Just today, the five-year T-Note yield dropped below the two-year note yield, to invert the yield curve. This is a warning signal to some traders and investors, suggesting slowing U.S. economic growth. The inversion also helped to spook the U.S. stock market today, and in turn support the gold and silver markets on some safe-haven demand.
The key outside markets today find the U.S. dollar index near steady after trading solidly lower early on. Some safe-haven demand also boosted the greenback from its lows today. The U.S.-China trade truce boosted the world’s secondary currency markets early this week, which in turn was pressuring the greenback.
Meantime, Nymex crude oil prices are near steady and trading around $53.00 a barrel. Some short covering was seen in the oil market recently, following steep losses. The OPEC oil cartel will meet in Vienna, Austria on Thursday. Reports said Russian and Saudi Arabian officials plan to extend production cuts. Also, Canada will curtail its crude production.
The death of former U.S. President George H.W. Bush and a national day of mourning Wednesday will close the U.S. stock and financial markets. Other U.S. futures markets will remain open as normal.
Technically, the gold bulls and bears are now on a level overall near-term technical playing field, but the bulls have momentum on their side. A price uptrend line is now in place on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at the October high of $1,252.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at last week’s low of $1,216.80. First resistance is seen at today’s high of $1,247.50 and then at $1,252.00. First support is seen at today’s low of $1,235.80 and then at $1,230.00. Wyckoff's Market Rating: 5.0
The silver bears still have the overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at the October high of $15.055 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the November low of $13.985. First resistance is seen at today’s high of $14.745 and then at $15.00. Next support is seen at today’s low of $14.46 and then at this week’s low of $14.28. Wyckoff's Market Rating: 3.0.March N.Y. copper closed down 560 points at 275.35 cents today. Prices closed near the session low today. The copper bears have the overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the September high of 288.80 cents. The next downside price objective for the bears is closing prices below solid technical support at the November low of 266.20 cents. First resistance is seen at 280.00 cents and then at today’s high of 282.30 cents. First support is seen at 272.50 cents and then at 270.00 cents. Wyckoff's Market Rating: 4.0.