Gold sees good gains as bulls step in to buy the early price dip

(Kitco News) - Gold prices are posting double-digit advances in midday U.S. trading Wednesday, as bullish bargain buyers stepped up to buy the early weakness. Bullish outside markets that include sharp gains in crude oil prices and a weaker U.S. dollar index also worked in favor of the precious metals market bulls today. April gold futures were last up $14.60 at $1,871.00 and March Comex silver was last up $0.213 at $23.555 an ounce.

Traders at midday were awaiting the afternoon release of the FOMC meeting minutes. The minutes may not provide much markets reaction as it appears the marketplace may have already dialed in an aggressive Federal Reserve monetary-policy-tightening pace in the coming months.

Global stock markets were mostly up overnight. The U.S. stock indexes are lower at midday. An apparent slight de-escalation of the Russia-Ukraine border stand-off may have somewhat lifted trader and investor risk sentiment at mid-week. However, the weaker U.S. stock market does not show a lot of risk appetite among traders and investors. Russia today said it has pulled back more if its troops from the Ukraine border. That situation is still very unpredictable and the geopolitical crisis is far from abating. President Biden on Tuesday said Russia still could invade Ukraine.

In other overnight news, higher-than-expected inflation in the U.K. has prompted talks of even more aggressive interest rate increases from the Bank of England. The U.K.’s January CPI rose by 5.5% year-on-year, above expectations of up 5.4%. The inflation report saw its steepest rise since March of 1992. Meantime, China’s consumer price index for January came in at up 9.1%, year-on-year.

The yield on the U.S. 10-year Treasury note is presently fetching 2.035%. The key outside markets today see crude oil prices solidly up and trading around $94.50 a barrel. The U.S. dollar index is lower today. 

Technically, April gold futures bulls have the solid overall near-term technical advantage. Prices are trending higher on the daily bar chart. Bulls' next upside price objective is to produce a close above solid resistance at the November high of $1,882.50. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,821.10. First resistance is seen at $1,875.00 and then at $1,882.50. First support is seen at today’s low of $1,851.80 and then at this week’s low of $1,845.40. Wyckoff's Market Rating: 7.5

March silver futures bulls have the slight overall near-term technical advantage. Bulls are working on a fledgling price uptrend on the daily chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the January high of $24.755 an ounce. The next downside price objective for the bears is closing prices below solid support at $22.00. First resistance is seen at $23.75 and then at this week’s high of $24.015. Next support is seen at today’s low of $23.29 and then at this week’s low of $23.07. Wyckoff's Market Rating: 5.5.

March N.Y. copper closed up 40 points at 453.60 cents today. Prices closed nearer the session low today. The copper bulls have the overall near-term technical advantage. Prices are in a choppy, two-month-old uptrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the February high of 470.85 cents. The next downside price objective for the bears is closing prices below solid technical support at the January low of 428.20 cents. First resistance is seen at today’s high of 458.95 cents and then at 460.00 cents. First support is seen at 450.00 cents and then at this week’s low of 444.40 cents. Wyckoff's Market Rating: 6.0.

By Jim Wyckoff

For Kitco News

 jwyckoff@kitco.com

www.kitco.com