Gold price up but down from earlier gains following US CPI data

(Kitco News, Thurs. Jan. 11th, 2023) – Gold and silver prices are firmer in early U.S. trading Thursday but have pulled back from their daily highs following a U.S. inflation report that came in a bit hotter than expected. February gold was last up $8.80 at $2,036.70. March silver was last up $0.119 at $23.18.

The just-released U.S. December consumer price index report showed a rise of 3.4%, year-on-year, versus expectations of up 3.3% and compares to a rise of 3.1% in the November report. The core CPI was up 3.9% versus expectations of up 3.8%, year-on-year. That data falls slightly into the camp of the U.S. monetary policy hawks, who want the Federal Reserve to keep its monetary policy tighter for longer. The December producer price index report is out on Friday morning.

Asian and European stock markets were mostly higher overnight. U.S. stock index futures are set to open slightly weaker when the New York day session begins and lost overnight gains following the CPI report. The U.S. stock index bulls had rebounded this week, following selling pressure the first week of the new year.

In other news, the U.S. Securities and Exchange Commission voted Wednesday to allow bitcoin to be traded as an exchange traded fund (ETF).

The key outside markets today see the U.S. dollar index a bit firmer. Nymex crude oil prices are up and trading around $72.75 a barrel. Meantime, the yield on the benchmark U.S. Treasury 10-year note is presently fetching 4.042% and up-ticked following the CPI data.

Other U.S. economic data due out Thursday includes the weekly jobless claims report, real earnings and the monthly Treasury budget statement.

Technically, the gold futures bulls still have the overall near-term technical advantage but are fading. Prices are still in a three-month-old uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close in March futures above solid resistance at $2,100.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $2,000.00. First resistance is seen at the overnight high of $2,056.10 and then at $2,071.10. First support is seen at the overnight low of $2,029.10 and then at this week’s low of $2,022.70.

The silver bears have the overall near-term technical advantage. Prices are in a choppy, four-week-old downtrend on the daily bar chart. Silver bulls’ next upside price objective is closing March futures prices above solid technical resistance at $25.00. The next downside price objective for the bears is closing prices below solid support at the November low of $22.26. First resistance is seen at this week’s high of $23.565 and then at last Friday’s high of $23.715. Next support is seen at the January low of $22.88 and then at the December low of $22.785.

Posted by:

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com