P.M. Kitco Metals Roundup: Comex Gold Ends Modestly Higher on Bargain Hunting, Weaker U.S. Dollar
(Kitco News) - Comex gold futures prices ended modestly higher Wednesday as bargain hunters stepped in to buy the dip in prices and as the U.S. dollar index weakened further. The gold market is in a consolidation mode this week, following last week's record high and ahead of the key U.S. jobs report on Friday. Comex June gold last traded up $8.10 an ounce at $1,425.60. Spot gold last traded up $5.50 at $1,424.75.
The U.S. dollar index was weaker Wednesday, which did support buying interest in the precious metals. The overall technical posture of the U.S. dollar index remains fully bearish, and that's been an underlying bullish factor for the precious metals for several weeks.
Crude oil prices were slightly lower Wednesday but still trading above $104.00 a barrel. The weaker crude oil market did limit the upside for gold. However, the inflationary implications of crude oil prices above $100.00 a barrel are overall bullish for the precious metals markets. On a near-term basis, precious metals traders will continue to look to the crude oil futures market as a gauge of the world geopolitical situation.
The rebound in the U.S. stock market from the March lows is a negative for the precious metals markets, as it shows investor risk appetite has increased, which has pulled some away demand for the safe-have precious metals markets recently. Another barometer that shows better risk appetite in the market place is rising U.S. Treasury bond and note yields.
Precious metals traders are looking ahead to Friday morning's U.S. employment report. Trading Thursday could be more subdued ahead of the report. Forecasts call for a rise in the key non-farm payroll employment of 195,000 in March. The overall unemployment rate is forecast to be at 9.9%. Look for more active trading in the market place on Friday, in the wake of the jobs report.
The London P.M. gold fix was $1,425.50 versus the previous P.M. fixing of $1,417.50.
Technically, June Comex gold futures closed near mid-range again Wednesday. The market this week is consolidating recent price gains. Bulls still have the solid overall near-term and longer-term technical advantage. Bulls' next near-term upside technical objective is to produce a close above solid technical resistance at the all-time record high of $1,450.00. Bears' next near-term downside price breakout objective is closing prices below psychological support at $1,400.00. First resistance is seen at this week's high of $1,433.30 and then at $1,440.00. First support is seen at this week's low of $1,411.50 and then at $1,400.00. Wyckoff's Market Rating: 8.0.
May silver futures closed up 53.8 cents at $37.525 an ounce Wednesday. Prices closed nearer the session high. Bulls have the strong overall near-term technical advantage. A two-month-old uptrend is in place on the daily bar chart. There are no early clues to suggest a market top is close at hand. The next downside price breakout objective for the bears is closing prices below solid technical support at $36.00. Bulls' next upside price objective is producing a close above solid technical resistance at last week's 31-year high of $38.18 an ounce. First resistance is seen at Wednesday's high of $37.77 and then at $38.00. Next support is seen at $37.00 and then at $36.745. Wyckoff's Market Rating: 8.5.
May N.Y. copper closed down 760 points at 427.05 cents Wednesday. Prices closed nearer the session low and scored a bearish "outside day" down on the daily bar chart. Prices hit a fresh two-week low Wednesday. Bulls still have the slight overall near-term technical advantage, but did fade Wednesday. Bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at last week's high of 445.45 cents. The next downside price breakout objective for the bears is closing prices below strong technical support at the March low of 407.60 cents. First resistance is seen at 430.00 cents and then at 432.50. First support is seen at Wednesday's low of 424.50 cents and then at 421.85 cents. Wyckoff's Market Rating: 5.5.
By Jim Wyckoff of Kitco News; email@example.com