(Kitco News) - Gold prices are solidly lower and hit a three-week low today, while silver prices are strongly down. Both metals are experiencing extreme daily price volatility, which can be catastrophic for both the bulls and bears who are shorter-term futures traders, amid the major whipsaw price action. February gold was last down $52.90 at $4,333.20. March silver prices were down $6.85 at $71.09.
This Friday, Jan. 2, could be the most important trading day yet for the mature bull-market runs in gold and silver. How the gold and silver markets’ prices close on Friday—nearer their weekly highs or nearer their weekly lows—could well set the tone for trading and price trajectory in both metals in the weeks ahead.
After posting big price gains on Tuesday, following absorbing huge losses on Monday, the gold and silver markets today are sharply lower again. Other commodity futures traders are closely eyeing the metals futures markets and their extreme daily price volatility—providing a bearish lean. CME Group said it will raise margins on precious metals futures for the second time in a week. Margins for gold, silver, platinum and palladium contracts will increase after the close of business today, CME said in a statement. The decision was made based on a review of “market volatility to ensure adequate collateral coverage,” CME said.
The key outside markets today see the U.S. dollar index slightly up. Crude oil prices are down a bit and trading around $58.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.138%.
Technically, February gold futures bulls’ next upside price objective is to produce a close above solid resistance at the contract/record high of $4,584.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,200.00. First resistance is seen at the overnight high of $4,384.90 and then at $4,400.00. First support is seen at the overnight low of $4,284.30 and then at $4,250.00. Wyckoff's Market Rating: 7.0.
March silver futures see Monday’s price action still appearing to have produced a big and bearish buying exhaustion tail, whereby the bulls run out of gas at the high and prices back way off to close near the daily low. Silver also saw a big and bearish “key reversal” down on the daily bar chart Monday. The bulls’ next upside price objective is closing prices above solid technical resistance at Monday’s record high of $82.67. The next downside price objective for the bears is closing prices below solid support at $67.50. First resistance is seen at $73.00 and then at $74.00. Next support is seen at $70.00 and then at $69.00. Wyckoff's Market Rating: 7.0.
(Hey! My “Markets Front Burner” weekly email report is my best writing and analysis, I think, because I get to look ahead at the marketplace and do some market price forecasting. Plus, I’ll throw in an educational feature to move you up the ladder of trading/investing success. And it’s free! Sign up here; it’s real easy.
