Gold Treads Water, Silver Sinks As U.S. Stock Indexes Hit New Highs

(Kitco News) - Gold held its own and finished near steady Tuesday amid a rally in the competing asset class of equities that saw the U.S. stock indexes push to record highs. Silver could not weather the storm and prices sold off, hitting a four-week low. February Comex gold was last down $0.80 an ounce at $1,298.10. March Comex silver was last down $0.219 at $16.90 an ounce.

World stock markets were also mostly higher Tuesday. The general strength in world equity markets continues to keep quite a bit of investor monies away from the precious metals markets. When the major bull run in stock markets starts to fizzle (and it most certainly will, at some point), then safe-haven gold and silver markets will benefit significantly.

Buying interest in gold and silver was also squelched a bit Tuesday after a U.S. report on consumer confidence hit its highest level in 17 years. The report supports the U.S. monetary policy hawks who want to see interest rates rise.

The key “outside markets” were in a daily bearish posture for the precious metals markets today, as the U.S. dollar index was higher and crude oil prices were a bit lower.

Focus for investors and traders this week includes a U.S. tax-cut plan being pushed through Congress, with its eventual passage still uncertain. The Senate is likely to vote on the tax legislation later this week.

Fed Chairman nominee Jerome Powell testified Tuesday at his confirmation hearing in front of the Senate Banking Committee. Powell made no remarks that were surprising or markets-moving.

The OPEC oil cartel meets on Thursday, where already imposed production cuts are expected to be extended.

Technically,February gold futures prices closed nearer the session high. The bulls have the overall near-term technical advantage. Prices are in a gentle, four-week-old uptrend on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,325.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the October low of $1,267.00. First resistance is seen at this week’s high of $1,303.40 and then at the October high of $1,312.70. First support is seen at this week’s low of $1,290.70 and then at $1,283.10. Wyckoff's Market Rating: 6.0

March silverr futures prices closed nearer the session low and hit a four-week low today. The silver bulls faded today and more selling pressure this week would produce a bearish downside “breakout” from a trading range on the daily bar chart. Bulls and bears are back on a level overall near-term technical playing field. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at the October high of $17.59 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the October low of $16.435. First resistance is seen at $17.00 and then at today’s high of $17.18. Next support is seen at today’s low of $16.525 and then at $16.70. Wyckoff's Market Rating: 5.0.

March N.Y. copper closed down 610 points at 309.65 cents today. Prices closed near the session low today on heavy profit taking. The copper bulls still have the overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 320.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 300.00 cents. First resistance is seen at 312.50 cents and then at today’s high of 315.80 cents. First support is seen at today’s low of 309.20 cents and then at the November low of 305.50 cents. Wyckoff's Market Rating: 6.0.