Some market watchers were scratching their heads at the big upside price moves in gold and silver markets Wednesday. What was the main driving force for the strong prices gains? Was it the depreciation of the U.S. dollar index this week? Was it a re-examination of the U.S. consumer price index report that may not be as indicative of problematic inflation as initially thought? Or, was it a high-volatility day in the U.S. stock indexes Wednesday that rekindled notions the stock market still has some rough days ahead, which produced some safe-haven demand for gold? Likely, it was all of the above factors that contributed in varying degrees to the rally in the precious metals markets today. The surprising gains in gold and silver triggered pre-placed buy stop orders in their futures markets, which sent prices even higher during the trading session. Also, the weak-handed shorts in the futures markets were forced to cover their bets Wednesday, pushing prices still higher. What’s more important is where gold and silver prices are headed from here. With Wednesday’s infusion of needed technical strength in the metals, more gains are likely in the near term, if not longer. Gold’s next upside near-term target is the January high of $1,370.50. Gold’s next longer-term upside price objective is the 2016 high of $1,377.50. Silver’s next upside technical target is the January high of $17.555. Silver’s longer-term upside objective is $18.64. All of these price targets are now within striking distance in the coming days, or few weeks. Stay tuned!
Daily Morning Report
World Stock Markets Firmer–U.S. Producer Price Index On Deck
Thursday, February 15–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Global stock markets were mostly higher overnight and mostly overlooked the volatility seen in the U.S. stock market Wednesday. U.S. stock indexes are pointed toward firmer openings when the New York day session begins.
China and South Korean markets were closed Thursday for the Lunar New Year holiday.
Following the hotter-than-expected U.S. consumer price index report on Wednesday that initially roiled the marketplace, traders and investors today will get the U.S. producer price index report for January. The January PPI is forecast to come in at up 0.4% from December, and up 0.2% excluding food and energy.
U.S. CPI Data Likely to Impact Markets Wednesday
Wednesday, February 14–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mostly higher overnight. U.S. stock indexes are pointing toward higher openings when the New York day session begins.
The big U.S. economic report of the week will be Wednesday’s consumer price index report. CPI for January is forecast to come in at up 0.4% from December and up 1.9% year-on-year. The so-called “core” inflation rate is forecast to come in at up 1.7%, year-on-year. How the U.S. dollar index reacts to the CPI will be key for the marketplace today.
In overnight news, the Euro zone reported its fourth-quarter gross domestic product at up 0.6% from the third quarter and up 2.7%, year-on-year.
Long Bull Run in U.S. Treasury Prices Appears Over
The U.S. Treasury bond and Treasury note markets have recently hit contract lows in price (rising yields). The downward treks in Treasury prices show no early clues of bottoming. That suggests rising U.S. interest rates and rising inflation. After a quarter-century bull market run in U.S. Treasury prices, it appears that bull has run out of gas. Stay tuned!–Jim
World Stock Markets Lower Early Tuesday
Tuesday, February 13–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mixed but mostly lower overnight. Worries about rising world inflation are keeping stock market traders and investors edgy. They also still worry about high daily volatility returning to the stock markets. U.S. stock indexes are pointing toward lower openings when the New York day session begins.
The key “outside markets” on Tuesday morning see the U.S. dollar index lower. Meantime, Nymex crude oil prices are near steady. The International Energy Agency on Tuesday warned the big increase in U.S. shale oil production will weigh down oil prices this year and glut the world oil market.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and Goldman Sachs retail sales reports, and the NFIB small business index.
World Stocks Markets Rebound to Start Trading Week
Monday, February 12–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were higher overnight, following sharp losses seen last week. U.S. stock indexes are pointing toward solidly higher openings when the New York day session begins. The big question on traders’ minds to start the week is if the recent period of very high daily price volatility has ended. Price action the first couple days of this week will go a long way in answering that question.
The key “outside markets” on Monday morning see the U.S. dollar index weaker on a corrective pullback from recent good gains. Meantime, Nymex crude oil prices are firmer on a corrective bounce from recent solid losses and on the rebound in world stock markets.
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