Gold settled higher Wednesday, recouping part of the losses suffered over the last four sessions that sent prices to a nearly six-month low. Gold prices then climbed above the settlement level as the dollar continued to weaken in the wake of the FOMC rate hike as expected, for the third time in 2017. The central bank lifted a key short-term U.S. interest rate to a range of 1.25% to 1.5% and stuck to its earlier forecast for just three rate hikes in 2018. However they also said It was widely expected the Fed would raise U.S. interest rates but said inflation remains surprisingly tame. That is leading some to believe the Fed may not be able to raise interest rates as rapidly as it would like, in the coming months. The comments about inflation in my view spurred gold higher and led the dollar lower. While gold and silver have been oversold on the charts, gold and silver will need follow through above an upward trend line that to me presents near term resistance on the charts. For February gold, near term resistance on the aforementioned trend line sits at 1262.9. A close above and the market will quickly challenge the 200 day moving average at 1268.3. Longer term resistances come in at the 100 day moving average at 1286.9 and downward trend line resistance at 1288.4. Support is down at the weekly low at 1238, and with a close below 1224 the next level down. For Silver, support is down first at 15.68. Second support is down at 15.55. A close below here and in my view its Katy bar the door down to 15.14. Resistance is up at 16.54 and above there at 16.65.
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