(Kitco News) - Gold prices are solidly down and silver prices near steady in midday U.S. trading Tuesday. Both markets hit seven-week lows today. The two precious metals are in a downdraft amid a very strong U.S. dollar, rising U.S. Treasury yields, less demand for metals from China and less risk aversion in the general marketplace at present. December gold was last down $17.20 at $2,600.30 and December silver was up $0.022 at $30.645.
Importantly, the psychology of the precious metals marketplace has changed the past week. It appears that most gold and silver traders/investors have moved from confidently buying price dips to now nervously selling any price strength. The main reasons for this change in psychology are the deteriorating near-term technical postures for gold and silver, and the return of better risk appetite to the general marketplace. Until this trader psychology changes, it appears the path of least resistance for gold and silver prices will remain sideways to lower.
The key outside markets today see the U.S. dollar index higher again and at a 4.5-month high. Nymex crude oil futures prices are a bit firmer and trading around $68.25 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently around 4.5%.
The U.S. data points of the week are the consumer price index on Wednesday and the producer price index on Thursday. CPI for October is seen up 2.6%, year-on-year, compared to a reading of up 2.4% in the September report.
Technically, December gold bulls have lost their overall near-term technical advantage and prices are trending down. Bulls’ next upside price objective is to produce a close above solid resistance at $2,700.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support $2,500.00. First resistance is seen at the overnight high of $2,633.40 and then at $2,650.00. First support is seen at today’s low of $2,595.70 and then at $2,575.00. Wyckoff's Market Rating: 5.0.
December silver futures bulls have lost the overall near-term technical advantage. Prices are trending down on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $32.50. The next downside price objective for the bears is closing prices below solid support at $29.00. First resistance is seen at $31.00 and then at this week’s high of $31.66. Next support is seen at the overnight low of $30.28 and then at $30.00. Wyckoff's Market Rating: 5.0.
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