Gold, silver sell off on profit-taking from shorter-term specs
Gold and silver prices are lower in midday U.S. trading Tuesday, on profit-taking from the shorter-term speculative futures traders and amid some improved trader/investor risk appetite in the general marketplace. Gold hit a six-week high on Monday, while silver hit a record high. February gold was last down $54.90 at $4,219.90. March silver prices were down $0.797 at $58.37.
U.S. stock indexes are a bit firmer at midday. Risk appetite is somewhat better today, following good demand for Japanese bonds that Japan’s government held today. On Monday the global bond markets were a bit jittery because of political/financial/economic worries regarding Japan.
The key outside markets today see the U.S. dollar index up a bit. Crude oil prices are weaker and trading around $59.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently around 4.08%.
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 the contract/record high of $4,433.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,100.00. First resistance is seen at the overnight high of $4,269.20 and then at $4,300.00. First support is seen at today’s low of $4,194.00 and then at $4,150.00. Wyckoff's Market Rating: 7.5.
March silver futures bulls have the strong overall near-term technical advantage. Their next upside price objective is closing prices above solid technical resistance at $60.00. The next downside price objective for the bears is closing prices below solid support at $52.50. First resistance is seen at today’s high of $59.095 and then at the contract high of $59.435. Next support is seen at this week’s low of $56.85 and then at $56.00. Wyckoff's Market Rating: 9.0
