Gold Closes Above $1,300, Powering Bulls And Suggesting More Upside

(Kitco News) - Gold and silver prices are moderately up in early-afternoon U.S. trading Monday. The yellow metal hit a seven-month high of $1,303.70 in February Comex futures today, giving the bulls fresh upside technical momentum to suggest more gains are in the offing. February gold futures were last up $4.80 an ounce at $1,302.90. March Comex silver was up $0.071 at $15.77 an ounce.

Weaker world stock markets to start the trading week benefited the safe-haven metals. European and Asian stock markets were mostly weaker overnight. U.S. stock indexes are solidly lower at midday. There is some risk aversion in the marketplace to start the trading week.

The U.S. government is open after being partially shut down for a month. However, the government could shut down again in mid-February if President Trump and the Democrats can’t reach a deal on the U.S. budget. Traders and investors are glad to be able to scrutinize some more fresh U.S. economic data to help the drive markets prices.

The U.S.-China trade war that has been playing out for months this week finds high-level officials from both countries meeting in Washington, D.C. There is no consensus on any progress that may or may not be made at this week’s talks. Comments from U.S. and Chinese officials have been all over the map recently.

The political situation in Venezuela is very fluid at present, with the potential for civil violence. The country is a major oil producer.

This week finds the Federal Reserve’s Open Market Committee (FOMC) meeting on Tuesday and Wednesday, with a statement on monetary policy on Wednesday afternoon. Markets could become active and volatile following the results of the meeting.

The U.K. parliament votes on the “Plan B” Brexit initiative from Prime Minister Theresa May on Tuesday.

The outside markets today see the U.S. dollar index trading weaker. Meantime, Nymex crude oil prices are solidly lower and trading just below $52.00 a barrel.

Technically, February gold futures bulls have the overall near-term technical advantage and have gained more power recently, keeping a price uptrend in place on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,330.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,275.00. First resistance is seen at today’s high of $1,303.70 and then at $1,310.00. First support is seen at today’s low of $1,296.50 and then at $1,290.00. Wyckoff's Market Rating: 6.5

March silver futures prices closed nearer the session high today. The silver bulls have the overall near-term technical advantage and have regained upside momentum. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at the January high of $15.955 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the January low of $15.195. First resistance is seen at today’s high of $15.83 and then at $15.955. Next support is seen at today’s low of $15.61 and then at $15.50. Wyckoff's Market Rating: 6.0.

March N.Y. copper closed down 465 points at 268.25 cents today. Prices closed nearer the session low. The copper bears have the overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 280.00 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 270.00 cents and then at the January high of 273.40 cents. First support is seen at 2.6500 cents and then at 263.45 cents. Wyckoff's Market Rating: 3.0.