(Kitco News) – Gold and silver prices are a bit firmer in early U.S. trading Wednesday, following a just-released weaker-than-expected U.S. economic report. June gold futures were last up $2.10 an ounce at $1,297.60. May Comex silver was last up $0.029 at $15.09 an ounce.
The ADP national employment report for March showed a gain of 129,000 jobs, which is a significant downside miss. The payrolls number was forecast to be up 173,000. This report is a precursor to the more important jobs report from the Labor Department that is due out Friday morning. The non-farm payrolls number in that report is forecast to be up 175,000 in March, with the unemployment rate expected to remain at 3.8%.
Asian and European stock indexes were firmer overnight. U.S. stock indexes are pointed toward higher openings and at 5.5-month highs when the New York day session begins.
So far this week, traders and investors have elevated risk appetites to boost world stock markets, due in part to optimism the U.S. and China will soon reach a trade deal. Talks on the matter take place in Washington, D.C. beginning today.
In overnight news, the Euro zone’s Markit composite purchasing managers’ index (PMI) showed a reading of 51.6 in March from 51.9 in February.
On the Brexit front, U.K.’s Parliament and Prime Minister Theresa May cannot come to agreement on a “soft” exit, with May wanting to extend the deadline for a “hard” exit.
The key outside markets today see the U.S. dollar index lower on a corrective pullback from recent gains. Meantime, Nymex crude oil prices are slightly higher, hit another 4.5-month high and are trading around $62.50 a barrel.
U.S. economic reports due for release Wednesday include the weekly MBA mortgage applications survey, the ADP national employment report, the U.S. services PMI, the ISM non-manufacturing report on business, the global services PMI, and the weekly DOE liquid energy stocks report.
Technically, the gold bulls still have the overall near-term technical advantage but have faded recently and need to show fresh power soon. Bulls’ next upside price objective is to produce a close in June futures above solid resistance at the March high of $1,330.80. Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at the March low of $1,287.50. First resistance is seen at this week’s high of $1,301.70 and then at $1,305.00. First support is seen at this week’s low of $1,289.50 and then at $1,287.50. Wyckoff’s Market Rating: 6.0
May silver futures bears have the slight overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at the March high of $15.65 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $14.50. First resistance is seen at this week’s high of $15.19 and then at 15.315. Next support is seen at this week’s low of $14.905 and then at $14.75. Wyckoff’s Market Rating: 4.5.
By Jim Wyckoff
For Kitco News