(Kitco News) - Gold prices are firmer and silver is slightly up in early U.S. trading Wednesday, ahead of a busy U.S. data day highlighted by the release this afternoon of the minutes from the last meeting of the Federal Reserve’s Open Market Committee (FOMC). A rally in the U.S. dollar index at mid-week is limiting the upside for the two precious metals. February gold was last up $5.50 at $2,670.90 and March silver was up $0.034 at $30.72.
Asian and European stock indexes were mixed overnight. U.S. stock indexes are pointed toward weaker openings when the New York day session begins. The U.S. data point of the day at mid-week is the FOMC minutes that are out this afternoon. The U.S. government and stock market are closed Thursday for former President Jimmy Carter’s national day of mourning.
In overnight news, Bloomberg reports a growing number of fund managers are warning that U.S. Treasury market repricing may have farther to go despite the Fed’s recent interest rate cuts. Options prices now suggest the potential for a rise in 10-year U.S. Treasury note yields to 5%. Meantime, China’s 10-year bonds now yield 3 percentage points less than the U.S. 10-year note. Chinese investors are moving into China’s bond market on fears of a slowing Chinese economy. The Chinese yuan continues to sell off despite China central bank intervention attempts to stabilize the Chinese currency.
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 solidly higher. Nymex crude oil futures prices are up, hit a three-month high, and trading around $75.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note is on the rise and is presently at 4.681%--the highest level since 2023.
U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the ADP national employment report, weekly jobless claims, monthly wholesale trade, the weekly DOE liquid energy stocks report, consumer credit and the FOMC minutes.
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 last week’s high of $2,681.00 and then at $2,700.00. First support is seen at $2,650.00 and then at Tuesday’s low of $2,643.50. Wyckoff's Market Rating: 6.0.
March silver futures bears have the slight overall near-term technical advantage. A nine-week-old downtrend is still in place on the daily bar chart. More gains this week would negate the downtrend, however. 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 this week’s high of $31.025 and then at $31.50. Next support is seen at this week’s low of $30.41 and then at $30.00. Wyckoff's Market Rating: 4.5.
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