(Kitco News) – Gold and silver prices are higher and hit two-week highs in midday U.S. trading Thursday. News that China’s central bank continues to add to its gold reserves and more-bullish near-term technical postures in both gold and silver recently are boosting both metals today. December gold was last up $17.70 at $3,451.00. September silver prices were last up $0.438 at $38.34.
The People’s Bank of China increased its gold reserves in July, marking nine straight months of purchases that are helping it diversify its holdings away from U.S. dollars. Bloomberg reported gold held by the central bank increased by 60,000 troy ounces, to 73.96 million troy ounces last month. This brings the total of purchases since last November to around 36 tons. Buying by central banks, including China’s, is among the key drivers of the 30% rally that gold has seen this year. While the central bank buying spree is expected to continue, the pace has slowed amid elevated gold prices.
The key outside markets today see the U.S. dollar index firmer. Nymex crude oil futures are slightly lower and trading around $64.25 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.233%.
Technically, December gold futures bulls have the firm overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at the July high of $3,509.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the July low of $3,319.20. First resistance is seen at today’s high of $3,470.30 and then at $3,500.00. First support is seen at the overnight low of $3,430.00 and then at $3,400.00. Wyckoff’s Market Rating: 7.0.
September silver futures bulls have the overall near-term technical advantage and have regained momentum. Silver bulls’ next upside price objective is closing prices above solid technical resistance at the July high of $39.91. The next downside price objective for the bears is closing prices below solid support at the July low of $36.28. First resistance is seen at the overnight high of $38.76 and then at $39.00. Next support is seen at $38.00 and then at $37.50. Wyckoff’s Market Rating: 7.0.
Jim Wyckoff has spent over 25 years involved with the stock, financial and commodity markets. He was a financial journalist with the FWN newswire service for many years, including stints as a reporter on the rough-and-tumble commodity futures trading floors in Chicago and New York. As a journalist, he has covered every futures market traded in the U.S., at one time or another.
Jim is the proprietor of the “Jim Wyckoff on the Markets” analytical, educational and trading advisory service. Jim also worked as a technical analyst for Dow Jones Newswires and as the senior market analyst with TraderPlanet.com. Jim is also a consultant with the highly respected “Pro Farmer” agricultural advisory service. Jim was also the head equities analyst at CapitalistEdge.com. He received his degree from Iowa State University in Ames, Iowa, where he studied journalism and economics.
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