(Kitco News) - Gold prices are firmer and hit new contract/record highs in early U.S. trading Tuesday. Bullish fundamentals and bullish technical charts continue to fuel buying interest among investors and speculators. December gold was last up $12.40 at $3,690.00. December silver prices were down $0.087 at $41.81.
U.S. stock indexes are pointed toward slightly firmer openings today in New York. Global stock indexes were mixed overnight.
In overnight news, European stocks struggled for direction today as investors digested France’s battle to repair its finances. The Stoxx 600 erased early gains as French President Emmanuel Macron moved to appoint a new prime minister within days, following the ouster of Prime Minister Francois Bayrou, which was expected by the marketplace. French assets have come under pressure amid continued uncertainty as Macron seeks a premier capable of steering a budget through a deeply fractured National Assembly. The continued lack of common ground is weighing on sentiment, driving up the country’s risk premium.
The offshore Chinese yuan held its recent advance at around 7.12 per dollar Tuesday, on three straight sessions of gains and supported by weakness in the U.S. dollar. The greenback continues to struggle as mounting concerns over a cooling U.S. labor market fueled expectations of Federal Reserve rate cuts as soon as next week. Traders are now pricing in an 89% chance of a 25-basis-point cut at next week’s FOMC meeting, with some even thinking a larger 50-basis-point reduction is possible.
The key outside markets today see the U.S. dollar index slightly lower, while crude oil futures are higher and trading around $62.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.07%.
U.S. economic data due for release today is light and includes the weekly Johnson Redbook retail sales report and the NFIB small business index.
Technically, December gold futures bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $3,750.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $3,550.00. First resistance is seen at $3,700.00 and then at $3,725.00. First support is seen at the overnight low of $3,669.80 and then at $3,650.00. Wyckoff's Market Rating: 9.0.
December silver futures bulls have the solid overall near-term technical advantage. A bull flag pattern has formed on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $45.00. The next downside price objective for the bears is closing prices below solid support at $38.00. First resistance is seen at this week’s high of $42.355 and then at $43.00. Next support is seen at this week’s low of $41.08 and then at last week’s low of $40.555. Wyckoff's Market Rating: 8.5.
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