(Kitco News) - Gold prices are just a bit lower in early U.S. trading Tuesday and overnight hit another record high of $2,664.60, basis December Comex futures. Silver prices are mildly up. Safe-haven bids are keeping a floor under the two precious metals markets. Technical charts remain bullish for gold and silver, too, which is inviting speculators to the long sides. December gold was last down $1.80 at $2,650.70 and December silver was up $0.11 at $31.195.
The precious metals got some underlying bullish news today as China’s central bank lowered a key rate, the reserve requirement ratio for banks, by 0.5% in bid to support China’s stock and property markets. That’s the biggest easing move by China since the pandemic. The PBOC easing will likely prompt better demand for raw commodities, including the metals, from the world’s second-largest economy. Copper prices rallied sharply on the news. The People’s Bank of China said it expects another 20-50 basis-point cut by year-end. The PBOC also lowered its short-term, seven-day RRP rate to 1.5% from 1.7%. PBOC governor Pan said the measures would add $142 billion in liquidity to the banking system. Reads a Barron’s headline today: “China’s stimulus is a big deal.”
Meantime, the Israel-Hezbollah military conflict is heating up rapidly, with the Israel air strikes in Lebanon this week being called the heaviest since 2006. This situation is keeping a safe-haven bid in gold and silver.
Asian and European stock indexes were mostly higher overnight. U.S. stock indexes are pointed to near steady openings when the New York day session begins.
The key outside markets today see the U.S. dollar index slightly down. Nymex crude oil prices are higher and trading around $72.00 a barrel. The benchmark 10-year U.S. Treasury note yield is on the decline and is presently fetching 3.768%.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook retail sales report, the monthly house price index, the S&P Core-Logic home indexes, the consumer confidence index, and the Richmond Fed business survey.
Technically, December gold bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $2,750.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,500.00. First resistance is seen at the overnight contract high of $2,664.60 and then at $2,675.00. First support is seen at this week’s low of $2,638.60 and then at $2,625.00. Wyckoff's Market Rating: 9.5.
December silver futures bulls have the overall near-term technical advantage. Prices are in a six-week-old uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the July high of $32.46. The next downside price objective for the bears is closing prices below solid support at $29.00. First resistance is seen at last week’s high of $31.755 and then at $32.00. Next support is seen at this week’s low of $30.67 and then at $30.00. Wyckoff's Market Rating: 6.5.
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