Gold Down Amid Risk-On Day in Marketplace, Higher U.S Dollar
Monday February 22, 2016 13:35
(Kitco News) - Gold prices ended the U.S. day session about where they started it Monday--solidly lower. Profit-taking pressure from recent gains, a higher U.S. dollar index on this day, and a generally improving risk sentiment in the world marketplace early this week all worked against the safe-haven metal. April Comex gold was last down $20.30 at $1,210.40 an ounce. March Comex silver was last down $0.288 at $15.085 an ounce.
There was keener risk appetite in the world marketplace Monday. World stock markets were mostly higher on the day. China’s Shanghai stock index rallied 2.3% Monday, following weekend news that Chinese authorities announced a secondary home sales tax cut. U.S. stock indexes were solidly higher in early afternoon trading.
Nymex crude oil prices were solidly higher and above $31.00 a barrel Monday afternoon to encourage the stock market bulls. The other key “outside market” saw the U.S. dollar index posting solid gains Monday, on an upside correction from recent selling pressure.
In other news, the British pound was under sharp selling pressure Monday as London’s mayor has come out against the U.K. staying in the European Union. There will be a referendum held on the matter in June.
Technically, April gold futures prices are still in a two-month-old uptrend on the daily bar chart and the bulls still have the overall near-term technical advantage. A bullish symmetrical triangle pattern has formed on the daily bar chart. Bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the February spike high of $1,263.90. Bears' next near-term downside price breakout objective is closing prices below solid technical support at $1,150.00. First resistance is seen at Monday’s high of $1,226.90 and then at Friday’s high of $1,235.30. First support is seen at Monday’s low of $1,202.50 and then at $1,200.00. Wyckoff’s Market Rating: 6.0
March silver prices have seen a four-week-old uptrend on the daily bar chart negated Monday and the bears have gained some downside momentum. Silver bulls’ next upside price breakout objective is closing March futures prices above solid technical resistance at the February high of $15.99 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $14.50. First resistance is a of $15.37 and then at $15.57. Next support is seen at $14.945 and then at $14.75. Wyckoff's Market Rating: 5.0.