Powerful rallies push gold, silver to all-time highs; safe-haven demand featured
Gold and silver prices are strongly up and hit record highs in midday U.S. trading Monday. Safe haven bidding is featured to start a holiday-shortened trading week, amid heightened geopolitical tensions. February gold was last up $84.00 at $4,471.00. March silver prices were up $0.91 at $68.43. February gold futures hit a record intraday high of $4,477.70, while March silver notched a record intraday high of $69.525 an ounce.
The two precious metals rallied on the weekend news that the U.S. is pursuing a third oil tanker near Venezuela, according to a U.S. official, as President Trump intensifies an oil blockade on Nicolás Maduro’s government. The tanker being pursued is flying under a false flag and under a judicial seizure order, and is believed to be the Bella 1 tanker, a Panamanian-flagged vessel sanctioned by the U.S., according to a Bloomberg report. The attempted interdiction follows the U.S. military boarding of the Centuries supertanker early Saturday and the Skipper on Dec. 10. The blockade appears to be putting pressure on Venezuela’s oil storage and could lead to a production collapse and widespread civilian unrest in Venezuela. Crude oil futures also rallied on the U.S.-Venezuela tensions.
Meantime, a senior Russian general was killed after a bomb exploded in his car in Moscow, according to investigators who pointed suspicion for the assassination at Ukraine. Lieutenant General Fanil Sarvarov, who was in charge of the operational training department in the Russian General Staff, died from injuries sustained when the device planted under his car detonated early Monday, the Investigative Committee said in a telegram statement and as reported by Bloomberg. It opened a murder investigation and said the involvement of Ukrainian special services in the killing was one potential theory being examined. Ukraine hasn’t commented.
The key outside markets today also lean price-friendly for the precious metals. The U.S. dollar index is lower. Crude oil prices are higher and trading around $57.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently around 4.16%.
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 $4,500.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,250.00. First resistance is seen at today’s record high of $4,477.70 and then at $4,500.00. First support is seen at $4,400.00 and then at the overnight low of $4,367.90. Wyckoff's Market Rating: 9.0.
March silver futures bulls’ next upside price objective is closing prices above solid technical resistance at $70.00. The next downside price objective for the bears is closing prices below solid support at $63.00. First resistance is seen at the overnight record high of $69.525 and then at $70.00. Next support is seen at the overnight low of $67.47 and then at $66.00. Wyckoff's Market Rating: 9.5.
