(Kitco News) - Gold and silver prices are sharply lower in midday U.S. trading Monday, on what are so far just routine downside corrections and profit taking from the shorter-term futures traders after recent good gains. A rally in the U.S. dollar index to a two-plus year high today and rising U.S. Treasury yields are also bearish outside-market elements to start the trading week. February gold was last down $34.00 at $2,680.90. March silver was down $1.029 at $30.295.
The U.S. data point of the week is the consumer price index for December, due out Wednesday. CPI is seen coming in at up 2.9%, year-on-year, versus up 2.7% in the November report. Excluding food and energy, the “core” CPI is seen rising 0.2% after four straight months of 0.3% increases, according to a Bloomberg survey. The core CPI is forecast to have risen 3.3%, year-on-year, unchanged from readings from the previous three months. The U.S. producer price index it out Tuesday.
The key outside markets today see the U.S. dollar index up and hit a two-plus year high. Nymex crude oil futures prices are sharply up, hit a six-month high, and are trading around $79.00 a barrel. New Western sanctions on Russian oil exports are credited in part for the recent rally in crude. The yield on the benchmark 10-year U.S. Treasury note is presently at 4.782%. The 10-year note yield stood at 3.65% when the Federal Reserve started cutting U.S. rates in September.
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 the December high of $2,761.30. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the December low of $2,596.70. First resistance is seen at $2,700.00 and then at today’s high of $2,723.80. First support is seen at today’s low of $2,679.60 and then at $2,673.70. Wyckoff's Market Rating: 6.5.
March silver futures bulls and bears are on a level overall near-term technical playing field. Silver bulls' next upside price objective is closing prices above solid technical resistance at the January high of $31.84. 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 $30.75 and then at $31.00. Next support is seen at today’s low of $30.225 and then at $30.00. Wyckoff's Market Rating: 5.0.
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