(Kitco News) - Gold and silver prices are solidly lower in midday U.S. trading Wednesday, on profit taking from the shorter-term futures traders. The price pullbacks are not surprising, given gold overnight hit a record high of $2,772.60, basis December Comex futures, and silver futures this week scored a 12-year high. Still, safe-haven demand and bullish charts are keeping a solid floor under the gold and silver markets. December gold was last down $26.20 at $2,733.70 and December silver was down $1.136 at $33.905.
Safe-haven demand is still in the cards for gold and silver. High tensions in the Middle East and the approaching U.S. presidential elections are creating keener uncertainty in the marketplace.
Reports came out overnight that Iran and Russia my try to prompt violence in the U.S. after the election. The Associated Press said a memo released by the Office of the Director of National Intelligence said both countries “could support violent protests either by covertly organizing events themselves or by encouraging participation in those planned by domestic groups. The aim, the officials wrote, would be to increase division, cast doubt on election results and complicate the transfer of presidential power.”
Meanwhile, “de-dollarization” is a buzzword at this week’s BRICS conference being held in Russia. “Investors will be listening out for any updates on the group’s willingness to proceed with the proposed cross-border payments system. This is designed to bypass the current dollar-dependent arrangement,” said a Trade Nation email dispatch today. De-dollarization moves by countries are also bullish for gold.
The key outside markets today see the U.S. dollar index solidly higher. The benchmark 10-year U.S. Treasury note yield is presently fetching around 4.22% and has been on the rise lately. Crude oil prices are lower and trading around $70.75 a barrel.
Technically, December gold bulls have the solid overall near-term technical advantage. However, price action today scored a bearish “outside day” down on the daily bar chart, whereby the daily high was higher and low was lower than Tuesday’s high and low. If there is good follow-through selling on Thursday, then a more significantly bearish “key reversal” down would be confirmed, which would be one chart clue that a near-term market top is in place. Bulls’ next upside price objective is to produce a close above solid resistance at $2,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,650.00. First resistance is seen at $2,750.00 and then at the overnight contract high of $2,772.60. First support is seen at today’s low of $2,722.10 and then at $2,708.70. Wyckoff's Market Rating: 8.5.
December silver futures bulls have the solid overall near-term technical advantage. Prices are in a 2.5-month-old uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at this week’s high of $35.07. The next downside price objective for the bears is closing prices below solid support at $32.00. First resistance is seen at $34.00 and then at $34.50. Next support is seen at today’s low of $33.61 and then at $33.225. Wyckoff's Market Rating: 8.0.
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