Gold a bit weaker as traders fear rising bond yields
Welcome to Kitco News' 2022 outlook series. The new year will be filled with uncertainty as the Federal Reserve looks to pivot and tighten its monetary policies. At the same time, the inflation threat continues to grow, which means real rates will remain in low to negative territory. Stay tuned to Kitco News to learn from the experts on how to navigate turbulent financial markets in 2022.
(Kitco News) - Gold prices are modestly down in midday U.S. action Monday. Rising government bond yields around the gold are working against the safe-haven metals bulls. February gold futures were last down $2.70 at $1,794.80 and March Comex silver was last up $0.01 at $22.405 an ounce.
Global stock markets were mixed overnight. U.S. stock indexes are solidly lower at midday. Trader and investor risk aversion is keener early this week. Rising bond yields amid tighter monetary policies from major central banks of the world are giving the marketplace pause. Last week the Federal Reserve suggested it will raise U.S. interest rates three times in 2022, in order to curb rising inflation that is becoming more problematic. Some analysts expect more than three rate hikes form the Fed this year.
The U.S. data point of the week will be Wednesday's consumer price index report for December, which is expected to come in at up 7.1%, year-on-year.
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The key "outside markets" today see Nymex crude oil futures prices lower and trading around $78.35 a barrel. The U.S. dollar index is firmer today. The yield on the U.S. 10-year Treasury note is presently fetching 1.795%, which a pandemic era high.
Technically, February gold futures bulls and bears are on a level overall near-term technical playing field amid recent choppy trading. Bulls' next upside price objective is to produce a close above solid resistance at the January high of $1,833.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the December low of $1,753.00. First resistance is seen at today's high of $1,802.00 and then at $1,815.70. First support is seen at today's low of $1,789.30 and then at the January low of $1,781.30. Wyckoff's Market Rating: 5.0
March silver futures bears have the overall near-term technical advantage. Recent price action suggests a market bottom is in place. Bulls are working on a price uptrend but need to show more power soon to keep it alive. 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 December low of $21.41. First resistance is seen at $22.85 and then at $23.00. Next support is seen at the Januarys low of $21.945 and then at $21.41. Wyckoff's Market Rating: 3.0.
March N.Y. copper closed down 515 points at 435.95 cents today. Prices closed nearer the session low today and scored a bearish "outside day" down. The copper bulls and bears are on a level overall near-term technical playing field. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the November high of 451.15 cents. The next downside price objective for the bears is closing prices below solid technical support at 420.00 cents. First resistance is seen at 440.00 cents and then at today's high of 443.05 cents. First support is seen at the January low of 431.35 cents and then at 428.00 cents. Wyckoff's Market Rating: 5.5.