(Kitco News) – Gold and silver futures prices are moderately higher in early U.S. trading Monday, supported in part by a weaker U.S. dollar index and higher crude oil prices. February gold futures were last up $2.20 an ounce at $1,243.70. March Comex silver was up $0.048 at $14.685 an ounce.
An eventful trading week lies ahead. The U.S. Federal Reserve’s Open Market Committee (FOMC) meets Tuesday and Wednesday to discuss monetary policy, while the U.S. government could be shut down at the end of the week if Congress and President Trump cannot agree on a budget plan. Most expected the FOMC to raise interest rates by 0.25% on Wednesday afternoon, at the conclusion of their meeting. Also, the Chinese government could this weeek announce major new economic initiatives to stimulate the world’s second-largest economy. China’s central bank made an unexpected injection of money into its financial system on Monday.
A heavy slate of U.S. economic data is also due out late this week, including the first estimate of third-quarter gross domestic product.
European and Asian stock markets were mixed overnight. U.S. stock indexes are pointed steady to mixed openings when the New York day session begins.
In overnight news, the Euro zone got some more very tame inflation news, as its consumer price index for November fell 0.2% from October and was up 1.9%, year-on-year. This continues a string of world inflation data that is not considered close to being problematic.
The key outside markets today see the U.S. dollar index weaker on a corrective pullback after hitting a nearly two-year high on Friday. Meantime, Nymex crude oil prices are firmer and trading around $51.50 a barrel.
U.S. economic data due for release Monday includes the Empire State manufacturing survey, the NAHB housing market index, and Treasury international capital data.
Technically, gold bulls still have the overall near-term technical advantage. Prices are still in a four-week-old uptrend on the daily bar chart, but just barely. Bulls’ next upside price objective is to produce a close in February futures above solid resistance at the December high of $1,256.60. Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at $1,220.00. First resistance is seen at Friday’s high of $1,247.30 and then at $1,250.00. First support is seen at the overnight low of $1,239.40 and then at last week’s low of $1,236.50. Wyckoff’s Market Rating: 5.5
March silver futures bears still have the overall near-term technical advantage. However, a choppy four-week-old uptrend is in place on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at the October high of $15.055 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the November low of $13.985. First resistance is seen at last week’s high of $14.90 and then at $15.00. Next support is seen at last week’s low of $14.56 and then at $14.28. Wyckoff’s Market Rating: 3.5.
By Jim Wyckoff
For Kitco News