Gold, Silver See Corrective Bounces As Trade Turns Choppy

(Kitco News) – Gold and silver prices are higher in early U.S. trading Friday, boosted by corrective rebounds from Thursday’s losses. Trading has been choppy recently, but the gold and silver bulls are holding onto their near-term technical advantage. April gold futures were last up $8.10 an ounce at $1,303.30. May Comex silver was last up $0.194 at $15.365 an ounce.

The raw commodity sector, including precious metals, has been given a boost by news that on April 1 China plans to further cut taxes on its businesses and citizens in an effort to stimulate the world’s second-largest economy and the world’s largest raw commodity importer. This news comes after China’s central bank recently eased its monetary policy following a few months of downbeat economic data, due in part to the U.S.-China trade war.

Asian and European stocks were mostly higher overnight, while U.S. stock indexes are also pointed toward higher openings when the New York day session begins. Keener investor risk appetite in the world marketplace at present is continuing to constrain the safe-haven gold and silver markets.

In overnight news, the Euro zone consumer price index in February rose 0.3% from January and was up 1.5%, year-on-year. Those numbers were in line with market expectations and continue a theme of low and non-problematic inflation in the major world economies.

The Brexit saga continues to play out with no “soft Brexit” deal in place, ahead of the March 29 “hard exit” (no deal) for the U.K. to leave the European Union. While this matter has the attention of the world marketplace, it is not impacting most markets in any significant way, save for the British Pound and U.K. equities.

The key outside markets today see the U.S. dollar index weaker. Nymex crude oil prices are lower and trading around $58.30 a barrel. Oil prices did hit a four-month high overnight.

U.S. economic reports due for release Friday include the Empire State manufacturing survey, industrial production and capacity utilization, Treasury international capital data and the University of Michigan consumer sentiment survey.

Technically, the 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 $1,320.00. 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 this week’s high of $1,311.60 and then at $1,317.00. First support is seen at the overnight low of $1,293.70 and then at this week’s low of $1,290.60. Wyckoff’s Market Rating: 6.5

May silver futures bulls have the slight 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 Thursday’s high of $15.47 and then at this week’s high of $15.55. Next support is seen at this week’s low of $15.135 and then at $15.00. Wyckoff’s Market Rating: 5.5.

By Jim Wyckoff
For Kitco News


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