(Kitco News) - Gold and silver prices are higher, with silver hitting a three-week high, in early U.S. trading Wednesday. The near-term technical postures for gold ands silver have turned more bullish recently, which is inviting the chart-based speculators to the long sides of those markets. The U.S. government will be likely be reopening this week and that has boosted the precious metals markets, too. A resumption of U.S. economic data flows may pave the way for a Federal Reserve interest rate cut in December. December gold was last up $25.20 at $4,141.60. December silver prices were up $0.876 at $51.635.
Global stock markets were mixed overnight. U.S. stock indexes are set to open higher in New York.
In overnight news, U.S. House of Representatives members are returning to Washington, D.C. today for a vote to end the 43-day U.S. government shutdown. House Speaker Mike Johnson said he believes the legislation, a hard-fought compromise forged in the Senate and endorsed by President Trump, will pass quickly. “But he’ll need to keep his fractious party in line in the face of stiff resistance from House Democrats whose leaders are urging them to vote against the legislation,” reports Bloomberg.
A buildup of 1 billion barrels of oil on the world’s oceans includes a disproportionately large amount of crude from nations subject to some kind of sanctions — a sign the measures are bringing a degree of disruption to the crude oil trade, according to a Bloomberg report. “Of the surge in oil on tankers since the end of August, as much as roughly 40% of the increase is barrels from Russia, Iran, Venezuela, or unclear origin, according to vessel-tracking data from Vortexa, Kpler and OilX,” said Bloomberg. “Even the lowest estimate, at about 20%, is a larger share of global crude production than the three nations have. The buildup doesn’t mean the barrels will never sell, but it is a threat to the revenues of sanctioned petro-states, with further ramifications for a global oil market that’s forecast to be headed for oversupply.” The fate of all that crude on water, affected by sanctions or not, will go a long way to shaping how oil prices move over the next few months, traders said. The buildup in restricted oil is led by Russian supplies, according to a Bloomberg analysis of the data from the vessel-tracking firms. Iranian shipments have also surged, hitting the highest level in seven years in October. “It’s clear that there is a lot of crude on the water now,” said Brian Mandell, executive vice president of marketing and commercial at Phillips 66, said on an earnings call late last month and as reported by Bloomberg.
The key outside markets today see the U.S. dollar index slightly higher. Crude oil prices are weaker and trading around $60.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.09%.
Note: The gold market operates through two primary pricing mechanisms. The first is the spot market, which quotes prices for on-the-spot purchase and immediate delivery. The second is the futures market, which sets prices for delivery at a future date. Due to year-end positioning market liquidity, the December gold futures contract is currently the most actively traded on the CME.
Technically, December gold futures bulls’ next upside price objective is to produce a close above solid resistance at $4,250.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,000.00. First resistance is seen at $4,175.00 and then at $4,200.00. First support is seen at the overnight low of $4,104.40 and then at $4,100.00. Wyckoff's Market Rating: 7.0.
December silver futures bulls have the solid overall near-term technical advantage and their next upside price objective is closing prices above solid technical resistance at the record high of $53.765. The next downside price objective for the bears is closing prices below solid support at this week’s low of $48.235. First resistance is seen at $52.00 and then at $52.50. Next support is seen at the overnight low of $50.75 and then at $50.00. Wyckoff's Market Rating: 8.0.
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