Gold, silver rebound from Monday's solid losses

(Kitco News) - Gold and silver prices are firmer as midday approaches Tuesday, but down from their session highs. The precious metals have rebounded from Monday’s solid selling pressure. A weaker U.S. dollar index and a dip in U.S. Treasury yields on this day are working in favor of the gold and silver bulls. February gold was last up $6.70 at $1,788.00 and March silver was up $0.048 at $22.465.

U.S. stock indexes are pointed lower at midday after a stronger-than-expected U.S. manufacturing report on Monday reinforced notions the Federal Reserve will have to keep its monetary policy tighter for longer. That report is also still limiting buying interest in the precious metals markets today. The ISM report also fell into the camp of those market watchers who think the U.S. may be able to avoid an economic recession.

The key outside markets today see the U.S. dollar index weaker. Nymex crude oil prices are lower and trading around $75.00 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently around 3.58%.

Technically, February gold futures prices hit a 3.5-month high Monday. The gold futures bulls have the overall near-term technical advantage. Prices are in a four-week-old uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at this week’s high of $1,822.90. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,733.50. First resistance is seen at $1,800.00 and then at the November high of $1,806.00. First support is seen at this week’s low of $1,778.10 and then at $1,770.00. Wyckoff's Market Rating: 6.0

March silver futures prices hit a seven-month high Monday. The silver bulls have the overall near-term technical advantage. Prices are in a choppy three-month-old uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $24.00. The next downside price objective for the bears is closing prices below solid support at $20.79. First resistance is seen at today’s high of $22.78 and then at $23.00. Next support is seen at today’s low of $22.31 and then at $22.00. Wyckoff's Market Rating: 6.0.

March N.Y. copper closed up 390 points at 383.45 cents today. Prices closed nearer the session high today. The copper bulls have the overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the November high of 394.70 cents. The next downside price objective for the bears is closing prices below solid technical support at 354.70 cents. First resistance is seen at this week’s high of 389.45 cents and then at 394.70 cents. First support is seen at this week’s low of 377.30 cents and then at 370.00 cents. Wyckoff's Market Rating: 6.0.

By Jim W

 jwyckoff@kitco.com

www.kitco.com