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Gold price near steady amid competing market forces at mid-week

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(Kitco News) - Gold futures prices are trading not far from unchanged in early U.S. action  Wednesday. A depreciating U.S. dollar on the foreign exchange market that sees the U.S. dollar index near a 2.5-year low is bullish for the precious metals. However, gold and silver bulls are still being squelched by rallying U.S. and global equity markets that see the U.S. stock indexes near record highs. February gold futures were last down $0.50 at $1,882.50 and March Comex silver was last up $0.218 at $26.435 an ounce.

Global stock markets were mostly up overnight. U.S. stock indexes are pointed toward higher openings and more record highs when the New York day session begins. Trader and investor risk appetite remains elevated as market participants are opting to look just over the horizon to see what will likely be strong economic recoveries under way as soon as late spring, and choosing to look beyond the Covid-19 pandemic that appears to be at its peak for infections and deaths in the U.S. and which has forced new business and public restrictions that are still hamstringing economic growth. Colorado has reported the first official U.S. case of the new strain of faster-spreading Covid that has hit the U.K.

Trading volumes are likely to start to die down at mid-week, ahead of the New Year’s Day holiday on Friday, when governments and markets are closed.

The U.S. dollar index is lower and overnight came within a hair of the recent 2.5-year low in early U.S. trading. The other important outside market sees February Nymex crude oil futures prices higher and trading around $48.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note futures is currently around 0.95%.

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, advance economic indicators, pending home sales, and the weekly DOE liquid energy stocks report.

Live 24 hours gold chart [Kitco Inc.]

Technically, the February gold futures bulls have the overall near-term technical advantage amid a price uptrend still in place on the daily bar chart. However, bulls need to show fresh power soon to keep the uptrend alive. Bulls’ next upside price objective is to produce a close in February futures above solid resistance at the November high of $1,973.30. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,820.00. First resistance is seen at Tuesday’s high of $1,891.30 and then at $1,900.00. First support is seen at this week’s low of $1,873.00 and then at last week’s low of 1,859.00. Wyckoff's Market Rating: 6.0

Live 24 hours silver chart [ Kitco Inc. ]

March silver futures bulls have the firm overall near-term technical advantage amid a near-term price uptrend in place on the daily chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the December high of $27.635 an ounce. The next downside price objective for the bears is closing prices below solid support at $25.00. First resistance is seen at the overnight high of $26.65 and then at $27.00. Next support is seen at the overnight low of $26.26 and then at $26.00. Wyckoff's Market Rating: 6.5.

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.