(Kitco News) – Gold and silver prices are moderately lower in early U.S. trading Monday. A higher U.S. dollar index that hit a seven-week high overnight is a bearish “outside market” force working against the precious metals markets to sthart the trading week. Gains in U.S. and world stock markets Monday is also a bearish element for the safe-haven metals. April gold futures were last down $8.10 an ounce at $1,310.40. March Comex silver was last down $0.089 at $15.72 an ounce.
The world marketplace continues in a generally upbeat mood, with no serious geopolitical events at present that would create anxiety. Remember, however, that history shows geopolitical calm can be quickly and unexpectedly interrupted.
Focus of the marketplace early this week is on U.S.-China high-level trade talks taking place in Beijing. U.S. Treasury Secretary Mnuchin and U.S. Trade Representative Lighthizer will attend the talks, likely to take place with them present later this week. Many traders and investors are upbeat that a deal can be reached by the March 1 deadline.
In overnight news, the U.K. economy grew at a paltry 1.4% in 2018, with the weak showing being mostly due to Brexit worries. This is yet another downbeat economic report coming out of Europe.
The continuing resolution passed by Congress a couple weeks ago expires on Friday, with the U.S. government set for another partial shutdown in the Democrats and President Trump cannot come to agreement on a budget plan. Another shutdown would be bearish for the U.S. stock market.
The key outside markets today see the U.S. dollar index firmer. Nymex crude oil prices slightly are weaker and trading just above $52.00 a barrel.
There are no major U.S. economic reports due for release Monday.
Technically, the April gold bulls still have the overall near-term technical advantage. Prices are still in a 2.5-month-old uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close in April futures above solid resistance at the January high of $1,331.10. Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at $1,300.00. First resistance is seen at the overnight high of $1,318.70 and then at last week’s high of $1,323.60. First support is seen at last week’s low of $1,306.40 and then at $1,300.00. Wyckoff’s Market Rating: 6.5
March silver futures bulls have the near-term technical advantage. A 2.5-month-old uptrend is in place on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $17.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $15.50. First resistance is seen at last week’s high of $15.935 and then at $16.00. Next support is seen at last week’s low of $15.635 and then at $15.50. Wyckoff’s Market Rating: 6.0.
By Jim Wyckoff
For Kitco News