Gold price powers to 4-week high on chart-based buying, weaker greenback
(Kitco News) - Gold and silver prices are posting strong gains in midday U.S. trading Wednesday, with both metals hitting four-week highs. Buy stop orders were hit in the futures markets for the metals after key technical resistance levels were penetrated on the upside. A sell off in the U.S. dollar index today also worked in favor of the precious metals market bulls. December gold futures were last up $35.90 at $1,795.00. December Comex silver was last up $0.646 at $23.16 an ounce.
The focus of the marketplace at mid-week was on the U.S. consumer price index report for September, which came in at up 0.4% from August and up 5.4%, year-on-year. The numbers were
expected up 0.3% from August and up 5.3% year-on-year. Today’s slightly warmer CPI data arguably landed in the camp of the U.S. monetary policy hawks, who want to see the Federal Reserve tighten its monetary policy sooner rather than later. The U.S. dollar index gained some ground after the CPI report was released but is still trading slightly down on the day. Rising energy costs and supply-chain bottlenecks in recent weeks have traders and investors even more keenly focused on inflation prospects in the months ahead. The Federal Reserve will closely scrutinize today’s CPI data as it mulls the timing of tapering its monthly government bond purchases (quantitative easing).
The U.S. stock indexes are mixed at midday. The recent wobbly nature of the U.S. stock indexes is also prompting a bit of safe-haven buying in gold and silver markets.
Traders Wednesday afternoon will closely examine the minutes of the last FOMC meeting of the Federal Reserve.
Technically, gold bulls have gained the slight overall near-term technical advantage. Prices are now in a fledgling uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the September low of $1,721.10. First resistance is seen at today’s high of $1,797.40 and then at $1,800.00. First support is seen at $1,782.40 and then at $1,770.00. Wyckoff's Market Rating: 5.5
December silver futures bears still have the overall near-term technical advantage. However, more gains this week would start a price uptrend on the daily chart and would also suggest that a market bottom is in place. Silver bulls' next upside price objective is closing prices above solid technical resistance at $24.00 an ounce. The next downside price objective for the bears is closing prices below solid support at the September low of $21.41. First resistance is seen at today’s high of $23.285 and then at $23.50. Next support is seen at $22.75 and then at today’s low of $22.48. Wyckoff's Market Rating: 3.5.
December N.Y. copper closed up 1,910 points at 451.70 cents today. Prices closed near the session high today and hit a 10-week high. The copper bulls have the overall near-term technical advantage and gained more power today. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the July high of 458.60 cents. The next downside price objective for the bears is closing prices below solid technical support at 425.00 cents. First resistance is seen at today’s high of 452.45 cents and then at 458.60 cents. First support is seen at 445.00 cents and then at 440.00 cents. Wyckoff's Market Rating: 6.5.