Gold sees price gains as U.S. PPI meets expectations, but still hot

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(Kitco News) -Gold and silver prices are slightly lower in early U.S. trading Monday, on routinedownside corrections after recent gains. The precious metals bulls still have someupside momentum. December gold was last down $2.00 at $1,826.00 and December Comexsilver was last down $0.107 at $24.43 an ounce.

TheU.S. data point of the day Tuesday is the producer price index report forOctober, which is seen coming in at up 0.6% from September. The Septemberreport showed a rise of 0.5%. A hotter PPI reading is likely to impact severalmarkets, including bonds, metals, currencies and the U.S. stock indexes.

Globalstock markets were mixed in overnight trading. The U.S. stock indexes are pointedto mixed openings when the New York day session begins. There remains littlerisk aversion in the global marketplace at present. Recent positive news on theCovid-19 front-falling infection rates in the U.S. and new, powerful drugs tocombat the virus-have contributed to the upbeat marketplace attitudes and arealso helping to lift equities markets. For now, traders and investors arepushing aside the growing prospects for rising and even problematic price inflation.

Inovernight news, Bitcoin prices rose to another record high near $68,000.

Thekey outside markets today see the U.S. dollar index a bit firmer. The USDX lastweek hit a new high for the year. Nymex crude oil prices are higher and tradingaround $82.35 a barrel. Meantime, the 10-year U.S. Treasury note yield is presentlyfetching 1.482%.

OtherU.S. economic data due for release Tuesday includes the weekly Johnson Redbookand chain stores sales indexes, and the NFIB small business index.

Technically,December gold futures bulls have the overall near-term technical advantage andhave momentum. A five-week-old uptrend is in place on the daily bar chart. Bulls'next upside price objective is to produce a close above solid resistance at theSeptember high of $1,836.90. Bears' next near-term downside price objective is pushingfutures prices below solid technical support at the November low of $1,758.50.First resistance is seen at the overnight high of $1,830.70 and then at $1,836.90.First support is seen at this week's low of $1.813.80 and then at $1,800.00. Wyckoff'sMarket Rating: 6.5.

The silver bulls and bears are on a level overall near-termtechnical playing field but the bulls have some momentum on their side. Silver bulls'next upside price objective is closing December futures prices above solid technicalresistance at $25.00 an ounce. The next downside price objective for the bears isclosing prices below solid support at $23.00. First resistance is seen at thisweek's high of $24.59 and then at $24.75. Next support is seen at this week's lowof $24.13 and then at $24.00. Wyckoff's Market Rating: 5.0.

By Jim Wyckoff

For Kitco News

Follow @jimwyckoffjwyckoff@kitco.comwww.kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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