Good price gains for gold, silver on safe-haven and technical buying
(Kitco News) - Gold and silver prices prices are solidly up in midday U.S. trading Monday, on strong rebounds from overnight selling pressure. Gold hit a two-week high and silver a three-week high. There is some keener risk aversion in the marketplace to start the trading week, which prompted a “buy-the-dip” move by the precious metals traders, including some safe-haven demand. The near-term technical postures for gold and silver have significantly improved the past few sessions, which also invited some chart-based buying today. February gold futures were last up $28.90 at $1,868.90 and March Comex silver was last up $0.582 at $24.835 an ounce.
Global stock markets were mostly lower overnight. U.S. stock indexes are mixed at midday. Risk aversion has crept back into the marketplace to start the trading week. The U.S. is reportedly set to slap more economic sanctions on Chinese officials, in response to China’s crackdown on Hong Kong protesters. Markets are also a bit edgy on weekend news the U.K. and the European Union are still far apart on a smooth Brexit plan. Also, the U.S. and other parts of the world continued to be ravaged by Covid-19. Record daily cases and deaths in the U.S. continue to get reported, with California virtually locked down again.
One the bright side it appears U.S. congressional leaders are still moving closer to agreeing on a financial stimulus package for Americans. The package would be just under $1 trillion.
Meantime, China’s economy continues to power ahead as that country last spring clamped down on its population and locked them up, ostensibly defeating the virus in that country. Chinese exports rose 21.1% in November, year-on-year, the biggest rise in nine years. China’s imports were up 4.5% in the same period, but below market expectations. The surging China economy likely means better consumer demand for gold bullion, as China and India are the two top consumer-gold-demand countries in the world.
The U.S. dollar index is slightly higher at midday and seeing a mild corrective bounce after hitting a 2.5-year low last week. The other important outside market sees January Nymex crude oil futures prices slightly up and trading around $46.40 a barrel. The yield on the benchmark 10-year U.S. Treasury note futures is currently trading at 0.9%.
Technically, February gold futures prices hit a two-week high today and scored a bullish “outside day” up on the daily bar chart. The gold bulls and bears are now back on a level overall near-term technical playing field but the bulls have momentum. A downtrend on the daily chart was negated today. Bulls’ next upside price objective is to produce a close in December futures above solid resistance at $1,900.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,800.00. First resistance is seen at $1,883.00 and then at $1,900.00. First support is seen at $1,850.00 and then at today’s low of $1,824.80. Wyckoff's Market Rating: 5.0
March silver futures prices scored a bullish “outside day” up on the daily chart today and hit a three-week high. Silver futures bulls have regained the slight overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at the November high of $26.27 an ounce. The next downside price objective for the bears is closing prices below solid support at the September low of $21.93. First resistance is seen at $25.00 and then at $25.50. Next support is seen at $24.50 and then at $24.00. Wyckoff's Market Rating: 5.5.
March N.Y. copper closed down 120 points at 351.25 cents today. Prices closed near mid-range today and hit a 7.5-year high. The copper bulls have the strong overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 375.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 330.00 cents. First resistance is seen at today’s high of 354.60 cents and then at 357.50 cents. First support is seen at today’s low of 347.85 cents and then at 345.00 cents. Wyckoff's Market Rating: 8.0.