Profit taking tempers early gold gains; silver solidly up
(Kitco News) - Gold prices are near steady in midday U.S. trading Monday, and have lost the sharp early gains as profit-taking and weak long liquidation from the shorter-term futures traders is featured. Silver is keeping most of its strong overnight gains. February gold was last down $0.90 at $4,327.00. March silver prices were up $1.273 at $63.28.
There are some reports the Russia-Ukraine war peace talks may be making some more progress, which may be prompting less risk aversion in the general marketplace and pressuring gold. Some reports said the talks taking place in Berlin today have made some further progress.
Global stock markets were mixed overnight. U.S. stock indexes are weaker near midday and lost early gains.
In overnight news, China’s CMOC Group extended its push into precious metals with a $1 billion deal to buy the Brazilian operations of Equinox Gold Corp. The deal will give CMOC full ownership of several mines or deposits in Brazil, with Equinox receiving $900 million in cash, plus a contingent payment of as much as $115 million, Bloomberg reported. The transaction is expected to be completed in the first quarter of next year, and will give CMOC full ownership of Aurizona, RDM, Fazenda and Santa Luz mines, with a combined annual gold production.
The key outside markets today see the U.S. dollar index down a bit. Crude oil prices are lower trading around $56.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.184%.
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 $4,200.00. First resistance is seen at last week’s high of $4,387.00 and then at $4,400.00. First support is seen at Friday’s low of $4,286.00 and then at $4,250.00. Wyckoff's Market Rating: 8.5.
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 $57.00. First resistance is seen at $65.00 and then at the record high of $65.085. Next support is seen at $63.00 and then at $62.50. Wyckoff's Market Rating: 9.5.
