In lunchtime U.S. trade on Tuesday, gold prices are slightly higher and silver prices are little lower. Gold is a good asset for technical-based buying because the charts continue to strongly support the bulls. Increasing crude oil prices are positive for the metals right now as well. However, a stronger US dollar index and a minor increase in US Treasury yields on this particular day are limiting advances in the metals. At $2,036.90, gold for February was last up $3.50. At $23.19, March silver was last down $0.12.
At lunchtime, U.S. stock index futures are neutral.
According to reports from overnight news, the chief of the central bank’s monetary policy department told a local news agency that China’s central bank has suggested it may reduce its reserve requirement ratio in order to increase lending and assist economic growth. Although the PBOC official’s statement does not portend a cut anytime soon, Bloomberg said that it might imply that one is being considered in the upcoming months. Prior to the central bank lowering the reserve requirement ratio for big banks in September of last year, similar remarks were made in July of last year. This news may also be helping the metals markets, which could lead to increased consumer and business demand for Chinese metals in the upcoming months.
The December producer price index report and the December consumer price index report, which are released on Thursday and Friday respectively, are the key U.S. data points of the week. Because of the recent slowdown in US inflation, the Federal Reserve has been able to ease up on its stricter monetary policy. In comparison to a 3.1% increase in the November report, the CPI report shows a 3.3% year-over-year increase.
The U.S. dollar index is currently slightly higher in the major outside markets. The price of a barrel of Nynex crude oil is currently trading at a strong increase of $72.75. In the interim, the benchmark 10-year U.S. Treasury note’s yield is currently 4.011%.
Bulls in February gold futures have the upper hand in the short run from a technical standpoint. On the daily bar chart, prices are in an uptrend that has lasted for three months. The next upward price target for bulls is to generate a closure over the strong resistance level at $2,100.00. The next short-term downside target for bears is to drive futures below the strong technical support level of $2,000.00. The high of $2,053.30 this week and the high of $2,071.10 on Friday of last week are the first points of resistance. Support may be found first at $2,022.70, this week’s low, and then at $2,015.00. Market Rating for Wyckoff: 6.5.
March futures for silver Overall, the short-term technical advantage is with the bears. On the daily bar chart, there has been a downturn over the past five weeks. The next upward price target for silver bulls is closing over strong technical resistance at $25.00. The bears’ next drop target is closing prices below strong support, which is the $22.26 low from November. The high point of $23.565 today is the first point of resistance, followed by $23.715. The next support is at $23.00, followed by the low of $22.785 from December. Market Rating for Wyckoff: 4.0.
March New York copper ended the day down 320 points, or 377.80 cents. Prices reached a three-week low today and closed closer to the session low. On the daily bar chart, prices also received a negative “outside day” rating. The tiny overall near-term technical advantage held by the copper bulls has evaporated. On the daily bar chart, an uneventful 2.5-month-old advance has been reversed. The next upward price target for copper bulls is to push and close above strong technical resistance at the December high of 397.40 cents. The bears’ next downward price target is closing prices below strong technical support, which is currently at 365.00 cents. The high point of today, 384.05 cents, and 386.60 cents are the first points of resistance. The low of 377.40 cents today serves as the first support, followed by 372.90 cents. 5.0 is Wyckoff’s market rating.
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