(Kitco News) – Gold and silver prices are lower in early U.S. trading Monday. Gold notched a five-week low, while silver hit a nine-week bottom. Risk-on trader and investor attitudes at present are hammering on the safe-haven metals. April gold futures were last down $12.10 an ounce at $1,287.00. May Comex silver was last down $0.106 at $15.15 an ounce.
Asian and European stock markets were mostly higher overnight, with the stock market in China hitting a nine-month high. U.S. stock indexes are also pointed toward firmer openings and at multi-month highs when the New York day session begins.
The Wall Street Journal reported Sunday the U.S. and China are close to finalizing a trade agreement. The story said China would lower its tariffs on U.S. imported goods, with the U.S. doing the same on most or all of the trade sanctions it levied against China last year. The report said U.S. President Trump and Chinese President Xi Jinping will meet in Florida later this month. A trade deal would end months of trader and investor uncertainty regarding the world’s two largest economies penalizing each other.
Attention of the marketplace later this week will be on the European Central Bank’s regular monetary policy meeting on Thursday. The ECB is expected to loosen its purse strings on money in order to stimulate an anemic Euro zone economy.
The U.S. jobs report from the Labor Department is due out Friday morning. That’s arguably the most important U.S. economic data point of the month.
In overnight news, the Euro zone January producer price index was released and it came in up 0.4% from December and up 3.0%, year-on-year. Those numbers were in line with market expectations.
The key outside markets today see the U.S. dollar index slightly firmer. Nymex crude oil prices are up and trading just above $56.00 a barrel.
U.S. economic reports due for release Monday includes the ISM New York report on business, and construction spending.
Technically, the April gold bulls have lost their overall near-term technical advantage. A 3.5-month-old price uptrend line on the daily bar chart has been soundly negated. Bulls’ next upside price objective is to produce a close in April futures above solid resistance at $1,300.00. Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at the January low of $1,281.50. First resistance is seen at $1,290.00 and then at $1,300.00. First support is seen at $1,281.50 and then at $1,275.00. Wyckoff’s Market Rating: 5.0
May silver futures bulls have also lost their overall near-term technical advantage. A 3.5-month-old uptrend on the daily bar chart has been soundly negated as a bearish double-top reversal pattern formed. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $15.65 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $15.00. First resistance is seen at the overnight high of $15.295 and then at $15.50. Next support is seen at $15.00 and then at $14.90. Wyckoff’s Market Rating: 5.0.
By Jim Wyckoff
For Kitco News