Gold Pushes To 6-Week High On Renewed Investor Demand

(Kitco News) -Gold prices were slightly higher in late U.S. trading Tuesday and did hit a six-week high during the session. An overnight dip in prices turned into a buying opportunity for bargain hunters when the U.S. day session got under way. Reports Tuesday said demand for physical gold from China is increasing ahead of the Chinese lunar new year. There has also been a pick-up in demand for gold-backed exchange-traded-funds early in 2017. The technical chart postures for gold and silver are also turning more bullish early this year. February Comex gold was last up $0.70 an ounce at $1,185.60. March Comex silver was last up $0.192 at $16.875 an ounce.

The world marketplace is anxiously awaiting President-Elect Donald Trump’s first press conference since his election, on Wednesday. Already, Trump’s Twitter tweets have unsettled stocks and stock sectors. The marketplace perceives that Trump wants better relations with Russia, but may take a hard line on relations with China.

The key “outside markets” on Tuesday saw the U.S. dollar index trading slightly lower. The greenback bulls still have the firm overall technical advantage despite some choppy trading action the past week. The other outside market saw Nymex crude oil prices lower on follow-through pressure after suffering sharp losses on Monday. Growing U.S. oil rig counts and news that Libya is ramping up its oil production are weighing on crude oil prices early this week. Nymex Crude oil finds strong overhead resistance at or near the recent high of $55.44 in February futures.

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Technically, February gold futures bears still have the overall near-term technical advantage. However, prices are in a three-week-old uptrend and there are chart clues that a market bottom is in place, and which also suggest prices can continue to trend sideways to higher in the near term. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,200.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,160.00. First resistance is seen at today’s high of $1,190.60 and then at $1,200.00. First support is seen at today’s low of $1,180.20 and then at this week’s low of $1,172.20. Wyckoff's Market Rating: 4.0

March silver futures prices closed nearer the session high and hit a four-week high today. The silver market bears still have the overall near-term technical advantage. However, there are early chart clues that a market bottom is in place. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $17.30 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $16.00. First resistance is seen at $17.00 and then at $17.30. Next support is seen at today’s low of $16.575 and then at this week’s low of $16.455. Wyckoff's Market Rating: 3.5.

March N.Y. copper closed up 750 points at 261.35 cents today. Prices closed nearer the session high today and hit a three-week high. The copper bulls have the overall near-term technical advantage and gained fresh power today. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the November high of 275.30 cents. The next downside price objective for the bears is closing prices below solid technical support at the December low of 244.80 cents. First resistance is seen at today’s high of 263.00 cents and then at 265.00 cents. First support is seen at 258.85 cents and then at 255.00 cents. Wyckoff's Market Rating: 6.5.

By Jim Wyckoff, contributing to Kitco News; jwyckoff@kitco.com