Gold sees profit taking; silver up in choppy trade
Gold prices are lower near midday Tuesday, on some routine profit-taking pressure from the shorter-term futures traders after hitting a three-week high overnight. Silver prices are higher on safe-haven demand amid choppy, two-sided trade. April gold was last down $63.40 at $5,162.00. March silver prices were up $1.142 at $87.765.
A European Union assessment found that President Trump’s new tariff policy will increase levies on some of the EU’s exports, including cheese and some agricultural products, above the level permitted in their trade agreement, Bloomberg reported. “The European Commission, which handles trade matters for the bloc, told lawmakers Monday that the new global tariff will be added to levies that are already in place, according to Bernd Lange, chair of the European Parliament’s trade committee. Trump’s new 10% global tariffs went into effect today, kicking off an effort to preserve his trade agenda after the court decision. The White House is working on a formal order that will increase the global tariff rate to 15%, according to an administration official. This matter still has a lot of uncertainty, which favors the safe-haven metals.
JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon, when asked about fierce competition across the financial industry, said he’s starting to see parallels to the era before the 2008 financial crisis, when a rush to make loans ended disastrously. “Unfortunately, we did see this in ’05, ’06 and ’07, almost the same thing — the rising tide was lifting all boats, everyone was making a lot of money,” Dimon told investors on Monday and as reported by Bloomberg. While JPMorgan isn’t willing to make riskier loans to boost net interest income, he said, “I see a couple people doing some dumb things. They’re just doing dumb things to create NII.” Dimon, who led the largest U.S. bank through the 2008 financial crisis and scooped up two major competitors that collapsed, said he expects the credit cycle will eventually sour again — though he is not sure when.
The key outside markets today see the U.S. dollar index slightly firmer, with crude oil prices near steady and trading around $66.25 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently around 4.04 percent.
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.
April gold futures bulls’ next upside price objective is to produce a close above solid resistance at $5,400.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,854.20. First resistance is seen at $5,200.00 and then at the overnight high of $5,269.40. First support is seen at $5,100.00 and then at $5,050.00. Wyckoff's Market Rating: 7.0.
March silver futures bulls see their next upside price objective is closing prices above solid technical resistance at $90.00. The next downside price objective for the bears is closing prices below solid support at the February low of $71.815. First resistance is seen at today’s high of $88.75 and then at $90.00. Next support is seen at this week’s low of $84.56 and then at $83.00. Wyckoff's Market Rating: 6.0.
