Gold and silver prices are relatively unchanged in early U.S. trading on Thursday as traders await direction from several U.S. economic data points that were released this morning. The price of February gold remained down at $2,015.20, while prices for March silver were up at $22.955. A variety of U.S. economic data was scheduled for release today, including the weekly jobless claims report, the Chicago Fed national activity index, the advance fourth-quarter GDP estimate and its inflation readings, the advance economic indicators report, durable goods orders, the Kansas City Fed manufacturing survey, and new residential sales.
The global stock markets saw mixed movement with Asian shares mostly up and European shares mostly down overnight. U.S. stock index futures were poised to open mixed as well, reflecting a mix of record highs in some sectors, but a bit of an overall cautious approach.
China’s monetary policy shift was a major development earlier in the week that boosted the market’s risk appetite. The one item of particular note is Wednesday’s 50 basis point reserve requirement ratio reduction for banks in China. The move is expected to stimulate construction activity, thus driving speculative interest in select commodities, including metals. Chinese metals markets rallied across the board, with tin, copper, and iron ore recording significant gains as a result.
The price of Nymex crude oil remained relatively high at around $76.00 a barrel, with the U.S. dollar index holding steady close to the $4.157%.
In the field of technical analysis, gold traders currently have the near-term advantage with a three-month uptrend on the daily bar chart, although the trend is fading. Silver traders face the challenge of a three-month low and a six-week downtrend, with the next upside price objective that aims to close March futures prices above solid technical resistance at $24.00.
Recent events in the commodity market reveal a mixed bag for traders with gold maintaining an upper hand, but silver pointing to downward pressure. The Chinese easing of monetary policy has added a sense of optimism to the global markets. This pushes gold to be even more attractive as an alternative investment option during times of economic instability. It remains to be seen if these shifts in the market are temporary or if they will have long-term implications.
