Price pullbacks for gold, silver Tuesday normal pauses in uptrends
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(Kitco News) - Gold and silver prices are modestly lower in early U.S. futures trading Tuesday, on normal downside corrections after gold hit a nearly seven-year high Monday and silver notched a more-than-three-month high. Monday’s price action does suggest the gold and silver bulls are a bit tired and need a pause. February gold futures were last down $1.10 an ounce at 1,567.70. March Comex silver prices were last down $0.034 at $18.145 an ounce.
Asian and European stock markets were mostly firmer overnight. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins. It appears risk aversion in the global marketplace has at least temporarily subsided following last week’s geopolitical shockwave that occurred when a U.S. drone strike killed a leading Iranian general in Baghdad, Iraq. U.S. stock indexes rebounded Monday to close firmer. Gold and oil prices have backed down from their spike highs scored on Monday.
It could be that many traders and investors figure Iran will not execute a major retaliation against the U.S. and its vaunted military, knowing such a move would invite a likely massive and devastating counter-attack from the U.S.—as was threatened by President Trump in a weekend tweet. Other veteran market watchers reckon Iran will retaliate against the U.S. but not right away. However, virtually all market participants agree the U.S. drone strike further stokes and already volatile Middle East.
In overnight news, the Euro zone December consumer price index was reported up 1.3%, year-on-year, versus November’s reading of up 1.0%. The December reading was in line with market expectations.
The key “outside markets” today see crude oil prices weaker and trading around $63.00 a barrel. Meantime, the U.S. dollar index is firmer.
U.S. economic data due for release Tuesday includes the weekly Goldman Sacs and Johnson Redbook retail sales reports, U.S. international trade data, the ISM non-manufacturing report on business, and manufacturers’ shipments and inventories.p align="center">
Technically, the gold bulls still have the solid overall near-term technical advantage but appear to be tired and in need of a pause. A price uptrend is still in place on the daily chart. Bulls’ next upside price objective is to produce a close in February futures above solid resistance at this week’s high of $1,590.90. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,530.00. First resistance is seen at today’s high of $1,572.70 and then at $1,580.00. First support is seen at $1,556.60 and then at $1,550.00. Wyckoff's Market Rating: 8.0
March silver futures bulls have the firm overall near-term technical advantage as a price uptrend line is in place on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $19.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $17.50. First resistance is seen at today’s high of $18.255 and then at this week’s high of $18.55. Next support is seen at today’s low of $17.975 and then at $17.83. Wyckoff's Market Rating: 7.0.