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Gold, Silver Prices Steady-Weak But Risk Appetite Recedes

Kitco News

(Kitco News) - Gold prices are trading near steady, while silver is slightly lower in early U.S. trading Tuesday. Both metals dropped to three-week lows overnight as the bulls are fading. There is some keener risk aversion in the marketplace today, which will limit the selling interest in gold and silver markets. February gold futures were last down $0.30 an ounce at $1,282.30. March Comex silver was down $0.079 at $15.32 an ounce.

European and Asian stock markets were mostly lower overnight. U.S. stock indexes are pointed toward lower openings when the New York day session begins. Some risk aversion has creeped back into the marketplace this week. U.S. stock and financial markets were closed for a federal holiday on Monday.

There are renewed worries about slowing global economic growth, as the International Monetary Fund released a report Monday that projected collective world economic growth at 3.5% in 2019, which is down from their last forecast in October for 3.7% growth. The IMF also warned about higher risks for sharper declines in world economic growth.

Meantime, China on Monday reported its economic growth rate in 2018 at 6.6%, which is the lowest level in 29 years.

Germany, the economic driver of the European Union, reported more dour economic data today, with its ZEW economic expectations index weakening in January, along with its current conditions index.

The U.S. government remains in partial shut-down mode with no agreement between the Democrats and President Trump to reopen it imminent. This is starting to drag on the U.S. economy, including the lack of fresh economic news to help drive many markets.

The important outside markets today see the U.S. dollar index trading slightly higher. Meantime, Nymex crude oil prices are lower and trading around $53.00 a barrel.  

The World Economic Forum is being held this week in Davos, Switzerland. Movers and shakers from around the world are there, but the U.S. has backed its government officials out due to the government shutdown.

U.S. economic data due for release Tuesday includes existing home sales.

Live 24 hours gold chart [Kitco Inc.]

Technically, the gold bulls have the overall near-term technical advantage but are fading. Prices are still in a two-month-old uptrend on the daily bar chart, but just barely. 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 $1,285.00 and then at last Friday’s high of $1,292.20. First support is seen at the overnight low of $1,276.00 and then at $1,270.00. Wyckoff's Market Rating: 6.0

Live 24 hours silver chart [ Kitco Inc. ]

March silver futures bulls are fading as prices hit a three-week low overnight. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at the January high of $15.955 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 the overnight high of $15.385 and then at $15.50. Next support is seen at the overnight low of $15.195 and then at $15.00. Wyckoff's Market Rating: 5.5.

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.