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Gold Weaker As World Risk Appetite Still Upbeat...For Now

Kitco News

(Kitco News) - Gold prices were ending the U.S. day session slightly lower and fell to a two-week low Wednesday. World stock markets paused at mid-week, after the good early-week gains. However, traders and investors worldwide are still in an upbeat mood, which is bearish for safe-haven gold. June Comex gold was last down $2.10 an ounce at $1,265.00. May Comex silver was last down $0.186 at $17.405 an ounce.

Focus at mid-week is on the Trump Administration’s tax-reform plan, some details of which are coming out today. That has added to the improved risk appetite in the world marketplace this week. However, Trump’s pro-business tax plan will have to make it through the U.S. Congress, which will be no easy task.

Importantly, the question on smart traders’ and investors’ minds is how long this “risk-on” mentality will last in the world marketplace, given still-present geopolitical tensions? My sense is that the post-French elections and U.S. tax-reform euphoria has just about run its course. Come next week, or sooner, market watchers will again be fretting about North Korea’s and Russia’s motives and their antipathy toward the U.S.

The key outside markets on Wednesday saw the U.S. dollar index trading solidly higher on a corrective bounce from recent selling pressure that drove the index to a 5.5-month low on Tuesday. Meantime, Nymex crude oil prices were slightly lower and hovering near this week’s three-month low.

Live 24 hours gold chart [Kitco Inc.]

Technically, June gold futures prices closed near mid-range today. Bulls are fading as a five-week-old uptrend on the daily bar chart has been negated. The gold bulls still have the slight overall near-term technical advantage but need to show fresh power soon to keep it. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,300.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,250.00. First resistance is seen at $1,275.00 and then at this week’s high of $1,280.00. First support is seen at today’s low of $1,262.30 and then at 1,250.00. Wyckoff's Market Rating: 5.5

Live 24 hours silver chart [ Kitco Inc. ]

May silver futures prices closed nearer the session low, hit a five-week low. The silver market bears have gained the overall near-term technical advantage amid the recent downdraft in prices. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at the April high of $18.655 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $17.00. First resistance is seen at today’s high of $17.625 and then at $18.00. Next support is seen at $17.25 and then at $17.00. Wyckoff's Market Rating: 4.0.

May N.Y. copper closed up 65 points at 258.50 cents today. Prices closed near mid-range on tepid short covering. The copper bears still have the slight overall near-term technical advantage. Prices are in a nine-week-old downtrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 270.00 cents. The next downside price objective for the bears is closing prices below solid technical support at the December low of 245.60 cents. First resistance is seen at 260.00 cents and then at 261.15 cents. First support is seen at 255.00 cents and then at this week’s low of 253.50 cents. Wyckoff's Market Rating: 4.5.

(Note: Follow me on Twitter--@jimwyckoff--for breaking market news.)

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.