Gold, Silver See Corrective Bounces Ahead Of FOMC Statement
(Kitco News) - Gold prices are moderately higher in early U.S. trading Tuesday, while silver is sporting solid gains. The metals are seeing corrective rebounds from selling pressure that drove the markets to multi-week lows on Tuesday. June Comex gold futures were last up $4.10 an ounce at $1,311.00. July Comex silver was last up $0.303 at $16.43 an ounce.
An important U.S. data point today is the just-released ADP national employment report for April, which showed a rise of 204,000. The number was forecast to be up 190,000 jobs. The gold market moved little after the release of this report.
However, the key U.S. markets event Wednesday will be the Federal Reserve’s Open Market Committee (FOMC) meeting that began Tuesday morning ends Wednesday afternoon with a statement. No change in U.S. interest rates is expected at this meeting. Focus will be on inflation prospects and what the FOMC members have to say on that matter.
A U.S. high-level trade delegation travels to China Thursday to try to avert a trade war between the world’s two largest economies.
On Friday is the U.S. employment report from the Labor Department—arguably the most important U.S. data point of the month.
The outside markets today see the U.S. dollar index slightly lower on a corrective pullback after hitting a 4.5-month high on Tuesday. Meantime, Nymex crude oil prices are slightly up and trading around $67.50 a barrel.
Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the ISM New York report on business, the global manufacturing PMI, and the weekly DOE liquid energy stocks report.
Technically, June gold bulls and bears are on a level overall near-term technical playing field. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at last week’s high of $1,337.60. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,300.00. First resistance is seen at Tuesday’s high of $1,317.40 and then at $1,325.00. First support is seen at $1,300.00 and then at $1,290.00. Wyckoff's Market Rating: 5.0
July silver futures bears have the firm overall near-term technical advantage. 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 $16.00. First resistance is seen at this week’s high of $16.58 and then at $16.75. Next support is seen at the overnight low of $16.175 and then at this week’s low of $16.07. Wyckoff's Market Rating: 3.0.