(Kitco News) - Gold prices are a bit weaker but well up from earlier sharp losses in midday U.S. trading Monday. Silver prices are solidly up and hit a three-week high. Rising U.S. Treasury yields that are at their highest levels since last May are a bearish outside-market element for the two metals to start the trading week. February gold was last down $3.40 at $2,651.50 and March silver was up $0.595 at $30.67.
The U.S. dollar index is sharply down today on worries about the bulging U.S. government debt load. Bloomberg reported the uptick in bond yields only adds further pressure to U.S. government debt. There are concerns the incoming Trump administration will reignite inflation. There’s $119 billion of U.S. government debt issuance this week, amid growing concern Republican-controlled Congress will push up spending and increase the U.S. budget deficit. The USDX quickly but only briefly shot up from its daily low on news President-elect Trump denied that he will go easier on new trade tariffs. Trump refuted a Washington Post story that quoted Trump aides as saying the new president may be more selective on new tariffs.
In other news, Bloomberg reports Goldman Sachs no longer sees gold reaching $3,000 an ounce by the end of 2025, pushing its forecast for that level to mid-2026 on expectations the Fed will make fewer U.S. interest-rate cuts. Gold prices gained 27% in 2024.
The U.S. data point of the week is the employment situation report for December on Friday. It’s forecast to show non-payrolls increasing by 160,000. That compares to a gain of 227,000 in the November jobs report.
The key outside markets today see the U.S. dollar index sharply lower on corrective pullback after hitting a more-than-two-year high last week. Nymex crude oil futures prices are slightly up and trading around $74.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is on the rise and is presently arounds 4.6%--the highest level since 2023.
Technically, February gold futures bulls have the overall near-term technical advantage. 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 at the November low of $2,565.00. First resistance is seen at today’s high of $2,663.80 and then at last week’s high of $2,681.00. First support is seen at the overnight low of $2,624.60 and then at $2,608.40. Wyckoff's Market Rating: 6.0.
March silver futures bears have the slight overall near-term technical advantage. However, a nine-week-old downtrend on the daily bar chart has been negated. Silver bulls' next upside price objective is closing prices above solid technical resistance at $32.00. The next downside price objective for the bears is closing prices below solid support at the December low of $29.145. First resistance is seen at $31.00 and then at $31.50. Next support is seen at $30.50 and then at $30.00. Wyckoff's Market Rating: 4.5.
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