(Kitco News) - Gold and silver markets are strongly higher and hit new all-time highs today, on safe-haven demand amid keen risk aversion in the general marketplace. February gold was last up $157.00 at $4,752.20. March silver prices were up $5.343 at $93.89.
Global stock markets early this week have slumped and high trader/investor anxiety as tensions between the U.S. and Europe have flared over President Trump’s push to take control of Greenland. Trump's visit to the World Economic Forum in Davos this week is set to be dramatic after he shook the foundations of the EU and NATO alliance and pledged new tariffs related to his Greenland ambitions. Trump unleashed fresh social media threats against European allies and threatened tariffs on French wine. Trump took a swipe at French President Emmanuel Macron for rejecting an invitation to back his latest peace initiative and suggested the U.S. would impose duties on France’s agriculture sector.
The markets outlook will hinge in part on the European Union’s response, with the bloc in talks to impose retaliatory tariffs on 93 billion Euros of U.S. goods,” said the report. Macron intended to request the activation of the EU’s so-called anti-coercion instrument, Bloomberg reported. German leader Friedrich Merz, however, said Monday that Germany’s heavier dependence on exports means it’s less willing to unleash the countermeasure. The tensions are also adding to the significance of a pending U.S. Supreme Court ruling on some of Trump’s earlier tariffs, with a decision possible as soon as today.
Also supporting safe-haven demand for gold and silver, U.S. Treasury yields rose to the highest in more than four months as a major sell off in Japanese bonds spilled over into global debt markets. Longer maturities led losses, with the U.S. 30-year yield rising nine basis points to 4.93% and 10-year yields up seven basis points to 4.287%, the highest levels since Sept. 3. Traders and investors are reacting to a tumble in Japanese bond prices, as well as the rising tensions between Europe and the U.S. “Concern around Japan’s fiscal outlook sent yields on the nation’s 40-year debt rocketing above 4% in the Asian session, the most on record. That’s weighing on long-dated debt around the world, with 30-year bonds also underperforming in Europe,” said a Bloomberg report.
The key outside markets today see crude oil prices up and trading around $60.50 a barrel. The U.S. dollar index is sharply down and the U.S. 10-year Treasury note yield is presently 4.271%--up significantly from last week.
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, February gold futures bulls’ next upside price objective is to produce a close above solid resistance at $4,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,500.00. First resistance is seen at the record high of $4,756.60 and then at $4,800.00. First support is seen at $4,650.00 and then at the overnight low of $4,622.20. Wyckoff's Market Rating: 9.5.
March silver futures bulls have the strong chart advantage and their next upside price objective is closing prices above solid technical resistance at $100.00. The next downside price objective for the bears is closing prices below solid support at $85.00. First resistance is seen at the overnight record high of $95.78 and then at $96.00. Next support is seen at $92.50 and then at the overnight low of $90.50 and then at $85.00. Wyckoff's Market Rating: 9.5.
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