Gold, Silver Prices Up On Technical Buying; Tame U.S. Inflation Also Supportive

(Kitco News) – Gold and silver prices are higher and hit two-week highs in early U.S. trading Wednesday. Chart-based buying and bargain hunting are featured this week. Another mild U.S. inflation report Wednesday is also bullish for the precious metals markets. April gold futures were last up $9.50 an ounce at $1,307.50. May Comex silver was last up $0.082 at $15.495 an ounce.

The U.S. economic data point of the day is the producer price index report for February, which came in at up 0.1% from January. The PPI was seen up 0.2% month-on-month. Tuesday’s U.S. consumer price index report was also very tame and did help to lift U.S. Treasury prices. Gold and silver prices were little-moved on the PPI report.

Asian and European stock markets were mixed overnight. U.S. stock indexes are pointed toward steady to narrowly mixed openings when the New York day session begins. There are still no major geopolitical hotspots to roil the marketplace and dent the keener trader and investor risk appetite.

British lawmakers voted late Tuesday on another Brexit plan offered by Prime Minister Theresa May, but despite some last-minute concessions from the European Union, the U.K. Parliament voted down May’s plan. There may be another vote today. The British pound was pressured on the no-vote news, even though such an outcome was expected by the marketplace. The U.K. is scheduled to leave the EU at month’s end.

In other overnight news, the Euro zone industrial output in January rose 1.4% from December but was down 1.1%, year-on-year. Those numbers were better than expectations but they also underscore an anemic Euro zone economy.

The outside markets today see the U.S. dollar index slightly lower on a corrective pullback from recent gains that put the index at a new high for the year last week. Nymex crude oil prices are firmer and trading around $57.50 a barrel.

U.S. economic reports due for release Wednesday include the weekly MBA mortgage applications survey, the producer price index, durable goods orders, construction spending and the weekly DOE liquid energy stocks report.

Technically, the April gold bulls have the overall near-term technical advantage. Bulls’ next upside price objective is to produce a close in April futures above solid resistance at $1,330.00. Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at the March low of $1,280.80. First resistance is seen at $1,310.00 and then at $1,317.00. First support is seen at $1,300.00 and then at this week’s low of $1,290.60. Wyckoff’s Market Rating: 6.5

May silver futures bulls have the overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $15.75 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at last week’s low of $14.985. First resistance is seen at the overnight high of $15.55 and then at $15.75. Next support is seen at Tuesday’s low of $15.31 and then at this week’s low of $15.225. Wyckoff’s Market Rating: 6.0.

By Jim Wyckoff
For Kitco News


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