(Kitco News) - Gold prices are higher in early U.S. trading Wednesday and maintained overnight gains following an important U.S. inflation report that was in line with market expectations. Safe-haven demand and chart-based buying remain the features in the gold market this week. February gold was last up $10.10 at $2,728.10 and March silver was down $0.187 at $32.565.
The U.S. data point of the week is today’s consumer price index for November, which came in at up 2,7%, year-on-year, which was right in line with market expectations and compares to a rise of 2.6% seen in the October report.
The Federal Reserve’s FOMC’s monetary policy meeting is next week. Today’s CPI report does not likely change the trajectory of what the Fed is thinking on its monetary policy. The CME’s FedWatch tool shows the probability of a 25 basis-point interest rate cut at around 85 percent.
Thursday comes rate decisions from the European Central Bank and Swiss National Bank. Both are expected to announce rate cuts of 25 basis points.
Asian and European stock indexes were mixed overnight. U.S. stock indexes are pointed toward mixed to slightly higher openings when the New York day session begins.
In overnight news, China’s yuan currency declined on a report Chinese monetary officials are considering allowing the currency to weaken in response to the threat of a trade war with the U.S. China’s economic summit began today.
The key outside markets today see the U.S. dollar index slightly firmer. Nymex crude oil futures prices are higher and trading around $69.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently around 4.2%.
Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the monthly Treasury budget statement, real earnings and the weekly DOE liquid energy stocks report.
Technically, February gold bulls have the firm overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at the contract high of $2,826.30. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,650.00. First resistance is seen at the overnight high of $2,741.00 and then at $2,748.00. First support is seen at the overnight low of $2,719.10 and then at $2,700.00. Wyckoff's Market Rating: 7.0.
March silver futures bulls have the overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at $34.00. The next downside price objective for the bears is closing prices below solid support at $31.00. First resistance is seen at this week’s high of $32.945 and then at $33.00. Next support is seen at Tuesday’s low of $32.305 and then at $32.00. Wyckoff's Market Rating: 6.5
(Hey! My “Markets Front Burner” weekly email report is my best writing and analysis, I think, because I get to look ahead at the marketplace and do some market price forecasting. Plus, I’ll throw in an educational feature to move you up the ladder of trading/investing success. And it’s free! Sign up here; it’s real easy. https://www.kitco.com/services
