Weak US Dollar Boosts Gold, Silver Prices

(Kitco News) - Gold and silver prices ended the U.S. day session higher and hit two-week highs Tuesday. Gold bulls are once again knocking on the door of the key $1,300 level. Heightened geopolitical tensions this week have prompted more safe-haven demand for gold, and to a lesser degree silver. A depreciating U.S. dollar against the other major currencies early this week is also a bullish element for the precious metals markets. Short-covering in the futures markets by weak-handed bears is further lifting gold and silver prices.December Comex gold was last up $7.70 an ounce at $1,292.70. December Comex silver was last up $0.214 at $17.185 an ounce.

Geopolitical worries have ratcheted up another notch on reports U.S. President Donald Trump will stop at the North Korea-South Korea demilitarized zone to deliver a strong anti-North Korea speech, during his Asia trip next week. Also, U.S. Defense Secretary James Mattis reportedly told his Army officers to be ready, in case U.S.-North Korea negotiations fail.

Meantime, the European Union is worried and its stock markets are shaky regarding Catalonia possibly seceding from Spain. The Catalan regional president gave a speech Tuesday, in which he said it is his intention to at some point separate Catalonia from Spain, per the recent voter referendum.

The U.S. dollar index was lower again Tuesday, on a corrective pullback from recent gains. There are still some signals the dollar index has put in a near-term low.

The other key outside market on Tuesday saw Nymex crude oil futures prices solidly higher and back above the key $50.00 level. Reports said Saudi Arabia plans to cut its crude oil exports in November.

Traders and investors are looking ahead to what is arguably the most important U.S. data point of the week: Wednesday afternoon’s minutes from the latest FOMC meeting. Most of the marketplace now expects the Federal Reserve to raise interest rates by 0.25% at the December FOMC meeting.

Technically, December gold futures prices closed nearer the session high. Bears still have the slight overall near-term technical advantage, but the bulls are having a very good week, so far. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,300.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at last week’s low of $1,262.80. First resistance is seen at today’s high of $1,296.70 and then at $1,300.00. First support is seen at today’s low of $1,284.60 and then at this week’s low of $1,277.70. Wyckoff's Market Rating: 4.5

December silver futures prices closed nearer the session high today and hit a two-week high. The silver bulls and bears are back on a level overall near-term technical playing field. A four-week-old downtrend on the daily bar chart has been negated. 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 last week’s low of $16.345. First resistance is seen at today’s high of $17.28 and then at $17.50. Next support is seen at $17.00 and then at this week’s low of $16.765. Wyckoff's Market Rating: 5.0.

December N.Y. copper closed up 345 points at 306.55 cents today. Prices closed nearer the session high and hit a four-week high today. 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 September high of 317.85 cents. The next downside price objective for the bears is closing prices below solid technical support at 290.00 cents. First resistance is seen at today’s high of 307.05 cents and then at 310.00 cents. First support is seen at this week’s low of 301.20 cents and then at 300.00 cents. Wyckoff's Market Rating: 7.5.