Gold, silver up as risk aversion a bit keener

(Kitco News) - Gold and silver futures prices are trading higher in midday U.S. dealings Wednesday. The safe-haven metals are getting some support from a bit more risk aversion in the general marketplace at mid-week. A lower U.S. dollar index and higher crude oil prices are also bullish outside market forces working in favor of the metals bulls today. Traders are now awaiting the U.S. data point of the day, which is this afternoon's Federal Open Market Committee FOMC minutes from the December meeting. February gold futures were last up $8.90 at $1,823.50 and March Comex silver was last up $0.069 at $23.125 an ounce.

The U.S. economic data pace picked up at mid-week, with the FOMC minutes due out this afternoon. Also, the ADP national employment report this morning showed a rise of 807,000, which was way higher than the 375,000 gain expected. However, the markets showed little reaction to the report.

Global stock markets were mostly lower overnight. U.S. stock indexes are pointed mixed but mostly lower at midday. Risk appetite has receded a bit as Omicron is rampant in the U.S. and other nations, which is causing worries the virus could again crimp global economies. There are reports U.S. government lawmakers have discussed another federal pandemic stimulus package for businesses that are still hurting from the economic effects of the virus.

The key "outside markets" today see Nymex crude oil futures prices higher, hitting a five-week high and trading around $78.30 a barrel. The U.S. dollar index is lower today. The yield on the U.S. 10-year Treasury note is presently fetching 1.68%. U.S. bond yields have been on the rise for three weeks and have taken a big jump this week. Don't be surprised to see renewed inflation concerns hit the marketplace in the near term and sap more risk appetite, as bond yields are likely to continue to rise.

Technically, February gold futures bulls have the overall near-term technical advantage and are working on a near-term price uptrend. Bulls' next upside price objective is to produce a close above solid resistance at $1,840.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,785.00. First resistance is seen at this week's high of $1,833.00 and then at $1,840.00. First support is seen at today's low of $1,812.70 and then at $1,800.00. Wyckoff's Market Rating: 6.5

March silver futures bears have the overall near-term technical advantage. Recent price action suggests a market bottom is in place. Bulls are working on a price uptrend but need to show more power soon to keep it alive. Silver bulls' next upside price objective is closing prices above solid technical resistance at $24.00 an ounce. The next downside price objective for the bears is closing prices below solid support at the December low of $21.41. First resistance is seen at the December high of $23.48 and then at $23.75. Next support is seen at this week's low of $22.655 and then at $22.50. Wyckoff's Market Rating: 4.0.

March N.Y. copper closed down 700 points at 440.45 cents today. Prices closed near the session low today. The copper bulls have the slight overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the October high of 477.70 cents. The next downside price objective for the bears is closing prices below solid technical support at 425.00 cents. First resistance is seen at this week's high of 448.05 cents and then at the November high of 451.15 cents. First support is seen at this week's low of 433.50 cents and then at 430.00 cents. Wyckoff's Market Rating: 5.5.

By Jim Wyckoff

For Kitco News

 jwyckoff@kitco.com