(Kitco News) - Gold prices are modestly up in late-session U.S. trading Wednesday, after scoring a six-month high overnight. There was some more safe-haven buying interest amid still wobbly U.S. and world stock markets. However, the main feature today was chart-based buying amid a much-improved near-term technical posture. The yellow metal is now closing in on psychological resistance at the $1,300.00 level, which if cleared would attract even more speculative buying interest. Meantime, silver prices hit a five-month high today. February gold futures were last up $3.00 an ounce at $1,284.30. March Comex silver was up $0.07 at $15.61 an ounce.

European and Asian stock markets were mostly down overnight. U.S. stock indexes are firmer in afternoon New York trading. For the year 2018, the U.S. stock indexes lost around 5%, which is the worst performance in 10 years. This is also attracting some flows from paper assets like stocks into hard assets like gold and silver.

Global equities reacted negatively today to more weak economic data coming out of China, the world’s second-largest economy. The Caixin manufacturing purchasing managers index (PMI) fell to 49.7 in December, showing contraction in the sector (below 50.0) for the first time in a year and a half.

There was also some weaker economic data coming out of the European Union, to also un-nerve traders and investors.

Lingering concerns about the U.S. government shutdown that is well into its second week, and about the monetary policy of the Federal Reserve in the coming months, are also weighing on trader and investor sentiment to start the year.

The key outside markets today see the U.S. dollar index solidly higher. Meantime, Nymex crude oil prices are also posting good gains and trading around $47.50 a barrel. The recent solid rebound in oil prices from last week’s 1.5-year low is also friendly for the metals markets.

Technically, gold bulls have the firm overall near-term technical advantage and have momentum on their side. A six-week-old price uptrend is 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 $1,300.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,260.00. First resistance for February futures is seen at today’s high of $1,291.00 and then at $1,300.00. First support is seen at today’s low of $1,280.80 and then at $1,275.00. Wyckoff's Market Rating: 6.5.

March silver futures prices closed nearer the session high and hit a five-month high today. The silver bulls have the overall near-term technical advantage and have momentum on their side. A six-week-old price uptrend is in place on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $16.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $15.00. First resistance is seen at today’s high of $15.68 and then at $15.85. Next support is seen at today’s low of $15.385 and then at $15.25. Wyckoff's Market Rating: 6.0.

March N.Y. copper closed down 165 points at 261.45 cents today. Prices closed nearer the session low and hit a 2.5-year low today. The copper bears have the solid overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 275.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 250.00 cents. First resistance is seen at 265.00 cents and then at today’s high of 267.50 cents. First support is seen at today’s low of 259.45 cents and then at 257.00 cents. Wyckoff's Market Rating: 1.0.

By Jim Wyckoff

For Kitco News

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