Gold and silver are under pressure from the upbeat US data

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(Kitco News) – Gold and silver prices fell sharply in US midday trading on Thursday. The metals market bulls are feeling the heat today from the US economy which does not seem to want to slide into recession anytime soon, after stronger-than-expected US data released this morning. Gold for February was last down $21.10 at $1,804.30, and silver for March was down $0.399 at $23.795.

Weekly jobless claims in the US did not rise as economists expected. Initial jobless claims rose slightly to 216,000, below expectations of 222,000. The final readings for GDP in the third quarter were surprisingly strong. Third quarter GDP came in at 3.2%, against consensus expectations for a 2.9% rise. Personal consumption expenditures rose 4.3% in the third quarter and core personal consumption expenditures were slightly higher than expected at 4.7%.

Today’s US data falls into the camp of the US monetary policy hawks, who want the Fed to keep its footing in the tightening accelerator. “Wall Street is still pricing in another rate hike at the February FOMC meeting, but if US data is unaffected, the rate hike should start in March,” said Edward Moya of OANDA.

Global stock markets were mixed overnight. US stock indices are pointing to a strong decline in the middle of the day. Volumes are likely to wane on Friday, ahead of the Christmas holiday weekend, as a massive winter storm batters much of the United States and heads towards the East Coast.

Rising COVID cases in China had the market reflecting late this week. Bloomberg reported that China is seeing 1 million new infections and 5,000 virus deaths each day, after the Chinese government eased Covid restrictions.

Today, the major foreign markets are witnessing an increase in the US Dollar Index. Crude oil prices on NYMEX are nearing stability, trading around $78.25 per barrel. Meanwhile, the yield on the 10-year US Treasury note is currently 3.675%.

Technically, the February gold futures bulls still have the overall technical advantage in the near term. There is a six week old bullish trend on the daily bar chart. The next bullish price target for the bulls is to produce a close above the solid resistance at the December high of $1,850.00. Bears’ next bearish price target in the near term is pushing futures prices below strong technical support at $1,775.00. We see first resistance at $1,820.00 and then this week’s high at $1,833.80. The first support is seen at $1,800.00 and then this week’s low at $1,793.20. Wyckoff Market Rating: 6.5

March silver futures saw some profit-taking today after prices hit an eight-month high on Wednesday. The silver bulls still have a strong overall technical advantage in the near term. The prices are in a choppy 3.5 month upward trend on the daily bar chart. The next bullish price target for silver bulls is for prices to close above the strong technical resistance at $25.00. The next downtrend price target for the bears is to close the price below the strong support level of the December low of $22.19. We see the first resistance at $24.00 and then the high of the day at $24.215. The next support appears at $23.50 and then $23.00. Wyckoff Market Rating: 7.0.

New York copper closed March down 445 points at 376.55 cents today. Prices closed near the session low and posted a downtrend outside the day to the bottom of the day. The bulls and bears are level on the all-out technical playing field in the near term. The next bullish price target for copper bulls is to push prices and close above strong technical resistance at the November high of 394.70 cents. The next downside price target for bears is to close prices below the strong technical support at 354.70 cents. We notice the first resistance at today’s high at 384.90 cents, then December’s high at 392.90 cents. The first support appears at this week’s low at 372.30 cents, then at 370.00 cents. Wyckoff Market Rating: 5.0.