Gold Prices At 3-Mo. High On Slumping Greenback, Geopolitics

(Kitco News) - Gold prices are up and hit a more-than-three-month high in early U.S. trading Tuesday.A slumping U.S. dollar index that hit a better-than-three-month low today isbullish for the precious metals markets. Gold and silver markets are alsoseeing safe-haven demand on heightened geopolitical risks. February Comex gold was last up $4.50 an ounce at $1,313.90. March Comex silver was last down $0.02at $17.12 an ounce.

Afeature in the marketplace early this week are rising tensions in Iran asdemonstrators in that country are demanding an overthrow of the rulinggovernment. There has been a violent crackdown on the demonstrators by theIranian government. U.S. President Donald Trump has tweeted that he supportsthe demonstrators, which is a dramatic shift from the Obama administration thatwas much more low key on such matters.

NorthKorea has made an overture to South Korea for negotiations, but is alsomaintaining it plans to ramp up its production of nuclear weapons, includingleader Kim Jong Un reportedly saying he as a nuclear button on his desk.

Theother key outside markets on Tuesday morning finds Nymex crude oil prices nearsteady on the day after hitting a 2.5-year high above $60.00 a barrel overnight.A supply disruption in the North Sea and the Iran demonstrations are supportingthe oil market. The recent rally in oil prices is bullish for the preciousmetals and the entire raw commodity sector.

U.S.economic data due for release Tuesday includes the U.S. and globalmanufacturing purchasing managers indexes.

Technically,Februarygold futuresbulls have the overall near-term technical advantage. Pricesare in a steep three-week-old uptrend on the daily bar chart. Bulls' nextupside technical objective is pushing and closing prices above chart resistanceat $1,340.00. Bears' next near-term downside price breakout objective isclosing prices below solid technical support at $1,280.00. First support isseen at today's low of $1,304.60 and then at $1,300.00. First resistance isseen at $1,320.00 and then at $1,325.00. Wyckoff's Market Rating: 6.0

Marchsilver bulls and bears are on a level overall near-term technical playingfield. However, recent gains suggest a market bottom is in place and that moreupside is attainable. The next upside price breakout objective is closingfutures prices above solid technical resistance at $17.50 an ounce. The nextdownside price breakout objective for the bears is closing prices below solidsupport at the October low of $16.435. First resistance is seen at last week'shigh of $17.175 and then at $17.25. Next support is seen at $17.00 and then at lastFriday's low of $16.865. Wyckoff's Market Rating: 5.0.

By Jim Wyckoff

For Kitco News

Follow @jimwyckoffjwyckoff@kitco.comwww.kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

Silver outperformance driven by weak supply growth

Supply data still points to major silver deficit this year

Canada second most significant player in global mining M&A

Plenty of potential for continued rotation out of tech

Platinum to palladium ratio low, platinum to gold high, versus history