Gold Hits 2-Mo. High, Then Backs Off On Profit Taking

(Kitco News) - Gold prices ended the U.S. day session modestly lower Tuesday, on some profit taking from the shorter-term futures traders and on a technical correction after poking to another two-month high overnight. February Comex gold was last down $4.20 an ounce at $1,211.40. March Comex silver was last up $0.004 at $17.19 an ounce.

Amid a lack of other major news developments so far this week, the world marketplace has focused on any pronouncements from the new Trump Administration. So far early this week President Trump has cancelled U.S. participation in a Pacific trade group and sign a directive to proceed with a major, controversial U.S. oil pipeline.

The U.K. Supreme Court on Tuesday ruled against a key Brexit package element pushed by the government of Prime Minister Theresa May. The Brexit matter will continue to simmer in the coming months, and is likely to be an underlying bullish element for safe-haven gold.

The U.S. dollar index is slightly higher Tuesday and that was a bit of a negative daily factor for the precious metals. However, recent selling pressure has produced early technical clues that the dollar index has put in a market top. Dollar index prices have been trending lower for three weeks.

The other key “outside market” on Tuesday sees Nymex crude oil prices trading firmer.  OPEC and Russian oil officials said Sunday they are holding to their stated plans to reduce their collective crude oil output. However, there remains stiff technical chart resistance just above present crude oil prices.

U.S. economic data released Tuesday did not significantly impact the precious metals markets. 

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Technically, February gold futures prices closed near the session low. The gold bulls and bears are still on a level overall near-term technical playing field. Prices are in a five-week-old uptrend on the daily bar chart. That suggests 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 $1,236.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,175.00. First resistance is seen at today’s high of $1,220.10 and then at $1,225.00. First support is seen at $1,200.00 and then at $1,195.00. Wyckoff's Market Rating: 5.0

March silver futures prices closed near mid-range. The silver market bears have the slight near-term technical advantage. However, prices are in a five-week-old uptrend on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $18.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $16.50. First resistance is seen at last week’s high of $17.36 and then at $17.50. Next support is seen at $17.00 and then at $16.84. Wyckoff's Market Rating: 4.5.

March N.Y. copper closed up 595 points at 270.70 cents today. Prices closed nearer the session high. The copper bulls have the firm overall near-term technical advantage. 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 250.00 cents. First resistance is seen at the January high of 271.60 cents and then at 275.30 cents. First support is seen at 267.00 cents and then at today’s low of 263.95 cents. Wyckoff's Market Rating: 7.0.

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