(Kitco News) - Gold and silver prices are solidly higher in midday U.S. trading Tuesday, with buying support coming from a down-tick in U.S. Treasury yields, a weaker U.S. dollar index and a sell off in the U.S. stock market on this day. It also appears there has been an up-tick in safe-haven buying of the two precious metals. December gold was last up $18.70 at $2,684.10 and December silver was up $0.494 at $31.80.
Reports early this week say Iran sent a message to the U.S. via a third country to say that if Israel’s response to the recent volley of missiles sent by Iran to Israel is limited to a specific target, Iran will not respond. Broker SP Angle this morning said that message “appears designed to put pressure on Israel via the U.S. and to persuade Israel not to target Iran’s oil terminals. If Israel hits Iranian oil facilities, then Iran will hit Israeli gas production, causing a potential new energy crisis. This would help Putin and hit Europe which is already struggling with high energy prices.” Also, the Washington post reported that Israel told the U.S. it will only attack Iran’s military targets. Crude oil prices are sharply lower today and trading around $70.25 a barrel. However, gold and silver rallied despite the big drop in oil prices today. One reason could be that metals market traders don’t believe Israel or the U.S. would tip their hand and let Iran know, beforehand, which targets Israel would or would not strike. Noted big trader Kyle Bass came out on CNBC this morning and said he is very dubious regarding Israel limiting its retaliatory strikes to just Iranian military targets. Others agree, saying the timing is right for Israel to do major damage to Iran’s nuclear industry. This perspective could be putting a better safe-haven bid back into the gold and silver markets today.
The benchmark 10-year U.S. Treasury note yield is presently fetching 4.045%.
Technically, December gold bulls have the solid overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at the contract high of $2,708.70. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,600.00. First resistance is seen at $2,700.00 and then at $2,708.70. First support is seen at today’s low of $2,654.40 and then at $2,645.00. Wyckoff's Market Rating: 8.5.
December silver futures bulls have the overall near-term technical advantage. Prices are still in a nine-week-old uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the May high of $33.50. The next downside price objective for the bears is closing prices below solid support at $30.00. First resistance is seen at $32.00 and then at $32.50. Next support is seen at $31.50 and then at this week’s low of $30.94. Wyckoff's Market Rating: 7.0.
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