Gold prices turned down due to profit-taking activities and short-term futures traders liquidating buying positions. Meanwhile, silver still maintained most of the strong gains achieved in the overnight session.
Some reports say that peace talks related to the Russia-Ukraine conflict may be making further progress, thereby reducing risk-off sentiment in the market in general and putting pressure on gold prices. Some sources said that the recent negotiations in Berlin have recorded new steps forward.
The global stock market moved in opposite directions in the overnight trading session. US stock indexes weakened around midday and lost the increase reached at the beginning of the session.
In overnight news, China's CMOC Group continues to expand to the precious metals sector with a $1 billion deal to buy back Brazil operations of Equinox Gold Corp.
According to Bloomberg, the deal would allow the CMOC to fully own some mines or projects in Brazil; Equinox would receive $900 million in cash, along with a conditional additional payment of up to $115 million.
The transaction is expected to be completed in the first quarter of next year, thereby giving the CMOC ownership of all Aurizona, RDM, Fazenda and Santa Luz mines, with a significant total annual gold output combined.
Technically, the next bullish target for February gold delivery is to close above a solid resistance zone at a contract peak/record of $4,433/ounce. The next near-term downside target for the sellers is to push the contract price below the strong technical support zone at 4,200 USD/ounce.
The first resistance level was at last week's peak of $4,387, then $4,400/ounce. First support was identified at the bottom of Friday at $4,286/ounce, followed by $4,250/ounce.
For the March silver contract, the next upside target for buyers is to close above strong technical resistance at $70/ounce. The next downside target for the bears is to close below a solid support zone at $57/ounce.
The first resistance level was at $65, followed by a record peak of $65.085. The next support was determined at $63, then $62.50.
Key outside markets today showed a slight decline in the US dollar index. Crude oil prices fell, trading around 56.50 USD/barrel. The benchmark 10-year US Treasury yield is currently at 4.184%.
Note: The world gold and silver markets operate through two main valuation mechanisms. The first is the spot market, listing prices for buying and selling and immediately delivering goods. Second is the futures market, which determines the price for delivery at a certain time in the future.
Due to market liquidity factors related to year-end position adjustment, the December gold contract is currently the most actively traded contract on the CME exchange.
