Silver leading gold as both hit new record highs on safe-haven demand
Gold prices are higher and silver prices are posting strong gains up near midday Wednesday, with both hitting new record highs. Silver bulls are now eyeing $100 an ounce. Risk aversion remains elevated in the marketplace at mid-week amid an active geopolitical environment that includes unrest in China and an aggressive U.S. approach to acquiring Greenland just after taking out the Venezuelan dictator. February gold was last up $26.00 at $4,626.90. March silver prices were up $5.392 at $91.70.
In today’s U.S. economic data, producer prices rose 0.2% month over month in November, accelerating from a 0.1% increase in October and matching market expectations, according to delayed data from the Bureau of Labor Statistics. Meanwhile, core PPI, which excludes food and energy, was unchanged on the month, slowing sharply from a 0.3% rise in October and undershooting the consensus forecast of a 0.2% increase. On an annual basis, headline producer inflation climbed to 3.0% from 2.8%, surpassing expectations of 2.7%. Core producer inflation also edged higher to 3.0% from 2.9%, likewise coming in above forecasts of 2.7%.
U.S. retail sales rose 0.6%, month-on-month, in November, the largest gain since July, rebounding from a revised 0.1% decline in October and exceeding forecasts of a 0.4% increase. The rise was driven by a rebound in auto sales, following a slowdown caused by the expiration of federal tax incentives on electric vehicles, and by strong holiday shopping.
Death toll in Iran soars as protests sweep the nation. More than 2,500 people have been killed in Iranian protests that have swept the nation, activist groups said and as reported by Bloomberg, as Tehran continued its crackdown despite President Trump’s threat of action over mounting fatalities. The U.S.-based Human Rights Activists News Agency reported 2,571 Iranian deaths as of Wednesday, up from about 500 at the start of the week and amid speculation the actual toll could be dramatically higher. Trump on Tuesday urged Iranian dissidents to continue protesting against the regime of Supreme Leader Ayatollah Ali Khamenei and “take over your institutions if possible,” adding that he would “act accordingly” once he assesses how many demonstrators have been killed. Trump earlier addressed the Iranian people in a Truth Social post, saying “HELP IS ON ITS WAY,” without specifying what he meant.
The key outside markets today see the U.S. dollar index down. Crude oil prices are slightly higher and trading around $61.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently around 4.15%.
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 $4,750.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,400.00. First resistance is seen at today’s record high of $4,650.10 and then at $4,675.00. First support is seen at today’s low of $4,594.30 and then at $4,550.00. Wyckoff's Market Rating: 8.5.
March silver futures bulls have the strong chart advantage and their next upside price objective is closing prices above solid technical resistance at $100.00. The next downside price objective for the bears is closing prices below solid support at $80.00. First resistance is seen at $92.50 and then at $94.00. Next support is seen at the overnight low of $86.75 and then at $85.00. Wyckoff's Market Rating: 10.0
