Gold and silver are posting solid gains despite risky attitudes

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(Kitco News) – Gold and silver futures prices are significantly higher in early U.S. trading Tuesday. On this day, the precious metals bulls appear to be focused on the prospect of more US liquidity in the market and some positive economic news from China that is sparking better consumer demand for gold and the potential for problematic inflation in the future. The gains in gold and silver come despite a heightened risk appetite in the market earlier this week. February gold futures last rose $ 20.30 to $ 1,852.40 and March Comex silver last rose $ 0.468 to $ 24.52 an ounce.

Global stock markets were mostly higher overnight. US stock indices point to higher opens if the session starts on New York day. There is a risk for traders and investors earlier this week. The first U.S. Covid-19 vaccines were introduced for health professionals, hopefully to turn the tide of the pandemic, which is the worst respiratory pandemic in over 100 years since the 1918 Spanish flu. The US Congress appears to be making progress on a slightly scaled-down US financial aid package for Americans ($ 748 billion). According to reports this week, the UK and the European Union have extended the deadline for concluding a smooth Brexit deal.

On the night news, China’s economic recovery continued into November. China’s industrial production rose 7.0% from a 6.9% growth in October and a forecast of 6.8% year over year. China’s retail sales rose 5.0% in November from 4.3% in October and 5.5% year over year. China’s economic growth comes from the fact that other large industrialized countries are struggling with new lockdowns due to the spread of Covid-19. The total number of pandemic deaths in the US this week topped 300,000. Some health experts predict that another 100,000 Americans will die from the virus by the end of January.

The Fed’s Open Market Committee (FOMC) meeting begins Tuesday morning and ends Wednesday afternoon with a statement and press conference from Fed Chairman Jerome Powell. The market will analyze words and comments from Fed officials for clues about US monetary policy direction in 2021. Most believe that the Fed will maintain its very accommodative monetary policy.

The US dollar index is weaker this morning after hitting another 2.5-year low on Monday. In the other major foreign market, Nymex crude oil futures prices are slightly higher in January, trading around $ 47.00 a barrel. The benchmark’s 10-year US Treasury Note futures yield is currently around 0.9%.

U.S. economic data due to be released on Tuesday includes the Empire State Manufacturing Index, import and export prices, industrial production and capacity utilization, and Treasury Department’s international capital data.

Tech-wise, the February bulls and bears in gold futures are at short-term technical levels. Bulls’ next price target is to hit a close above solid resistance at the December high of $ 1,879.80 in February. Bears’ next near-term downside target is to push forward prices below solid technical support at the November low of $ 1,767.20. The first resistance is at $ 1,858.00 and then at $ 1,879.80. Initial support is seen at the overnight low of $ 1,828.50 and then this week’s low of $ 1,820.00. Wyckoff’s market valuation: 5.0

Bulls and bears for silver futures in March are at short-term technical levels. Silver Bulls’ next price target is to close prices above solid technical resistance at the November high of $ 26.27 an ounce. The next downside target for the bears is to close prices below solid support at the September low of $ 21.93. Initial resistance is at $ 24.75 and then at the December high of $ 25.015. The next support is seen at $ 24.00 and then last week’s low of $ 23.63. Wyckoff’s market valuation: 5.0.