(Kitco News) - Gold prices are near steady and silver prices are solidly higher in midday U.S. trading Wednesday. Both markets are near their daily highs. Gold prices were solidly lower overnight and in early U.S. trading, before the release of a hot U.S. inflation report. Yet, shortly after the consumer price index report gold prices moved to higher daily levels (but were still lower on the day) than what were seen just before the CPI report. What this suggests is that safe-haven demand for gold remains solid despite a hot and normally bearish U.S. inflation report that pushed up U.S. bond yields and initially rallied the U.S. dollar index. April gold was last up $2.10 at $2,935.20. March silver prices were last up $0.508 at $32.82.
The U.S. data point of the week saw the consumer price index for January coming in up 3.0% annually. CPI was seen coming in up 2.9%, year-on-year. The “core” CPI, which excludes food and energy, was up 3.3% and was expected to come in up 3.1% annually. These numbers are the hottest in months and fall into the camp of the U.S. monetary policy hawks, who want to see the Fed hold off on cutting rates.
The U.S. dollar index initially rallied to its daily high after the hot CPI data but has since backed off to trade lower on the day. The yield on the benchmark 10-year U.S. Treasury note pushed higher after the inflation report and is presently around 4.65%.
U.S. stock indexes sold off on the hotter CPI number but rebounded off their daily lows partly due to reports President Trump said he had a productive telephone call with Russian President Putin regarding ending the Russia-Ukraine war.
Federal Reserve Chairman Jerome Powell addressed the U.S. House Financial Services Committee today, after speaking to a U.S. Senate committee Tuesday. He said the Fed is in no rush to cut interest rates further because it doesn’t want to hinder the fight against price inflation. However, President Trump came out on social media today and said the U.S. needs lower interest rates. Today’s hot CPI data “puts the Fed in a box,” said a CNBC reporter.
Technically, April gold futures bulls have the strong overall near-term technical advantage. Prices are trending up on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $3,000.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,800.00. First resistance is seen at $2,950.00 and then at the contract high of $2,968.50. First support is seen at $2,900.00 and then at this week’s low of $2,879.90. Wyckoff's Market Rating: 9.0.
March silver futures bulls have the overall near-term technical advantage amid a price uptrend in place on the daily bar chart. 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 $33.00 and then at $33.33. Next support is seen at $32.50 and then at $32.00. Wyckoff's Market Rating: 6.0.
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