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Gold, Silver Rallies Pause As World Stock Markets Rally

Kitco News

(Kitco News) - Gold and silver prices are modestly lower in early U.S. trading Wednesday. The safe-haven metals are seeing some selling pressure this week as global equity markets are rising amid by upbeat trader and investor attitudes. February gold futures were last down $3.10 an ounce at $1,282.80. March Comex silver was down $0.023 at $15.69 an ounce.

European and Asian stock markets were mostly higher overnight. U.S. stock indexes are pointed toward firmer openings and at three-week highs when the New York day session begins. Investors are in a good mood this week as reports continue to be positive on the U.S.-China trade talks going on in Beijing. Those talks are expected to end today. “Talks with China are going very well,” President Trump tweeted Tuesday.

The marketplace is awaiting the Wednesday afternoon release of the minutes from the last meeting of the Federal Reserve’s Open Market Committee (FOMC). Traders will parse the report for clues on the direction and timing of Fed policy in the coming year.

St. Louis Federal Reserve President James Bullard overnight said the Fed should refrain from raising interest rates for fear of bringing on a U.S. recession. Bullard is a voting member of the FOMC.

In other overnight news, the Euro zone reported its unemployment rate for November was 7.9% versus 8.0% in October. The November reading was the lowest in 10 years.

The U.S. government shutdown is into its third week, but the matter is currently not a front-burner issue for markets. President Trump addressed U.S. citizens in a speech on the matter Tuesday evening, and leading Democrats countered.

The key outside markets today see the U.S. dollar index slightly lower. The USDX has been trending sideways to lower on the daily chart for three weeks. Meantime, Nymex crude oil prices are higher and trading above the key $50.00 a barrel level. There are chart clues the oil market has bottomed out, including prices pushing back above the important psychological level of $50.00.

Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey and the weekly DOE liquid energy stocks report.

Live 24 hours gold chart [Kitco Inc.]

Technically, the gold bulls have the overall near-term technical advantage. Prices are in a seven-week-old uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close in February futures above solid 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 is seen at the overnight high of $1,288.10 and then at this week’s high of $1,297.00. First support is seen at last week’s low of $1,278.10 and then at $1,275.00. Wyckoff's Market Rating: 6.5

Live 24 hours silver chart [ Kitco Inc. ]

March silver futures bulls have the overall near-term technical advantage. A seven-week-old 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 this week’s high of $15.88 and then at last week’s high of $15.955. Next support is seen $15.50 and then at $15.385. Wyckoff's Market Rating: 6.0.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.