Gold Near Steady; Firmer USDX Offsets Stock Mkt Sell-Off
(Kitco News) - Gold and silver markets were ending the U.S. day session near unchanged levels in two-sided trading Monday. A bit of safe-haven demand was featured as world equity markets are selling off, led by strong down-moves in the U.S. stock indexes. However, a rally in the U.S. dollar index to start the trading week worked to mitigate buying interest in the precious metals markets. April Comex gold futures were last down $0.70 an ounce at $1,336.60. March Comex silver was last down $0.019 at $16.69 an ounce.
World stock markets were mostly lower Monday. U.S. stock indexes were posting sharp losses in early-afternoon trading. The U.S. stock indexes saw bearish weekly low closes last Friday, which are technical clues near-term market tops are in place. Worries about rising interest rates and inflation worldwide, as evidenced by rising world bond yields, have spooked the global equities markets.
Look for gains in the safe-haven gold and silver markets if the world stock markets remain under solid pressure this week. Money flows out of paper assets (stocks and bonds) will benefit the hard assets, including precious metals. Steady money flows out of the overly inflated world stock markets would continue to support the metals, and quite possibly for quite some time to come.
The other key “outside market” was also bearish for the metals on Monday. Nymex crude oil prices were solidly lower and trading below $64.00 a barrel. More selling pressure in the oil market this week would suggest a market top is in place.
Technically, April gold futures prices closed near mid-range. The gold bulls still have the overall near-term technical advantage. However, a six-week-old uptrend on the daily bar chart has stalled out. Also, last Friday’s bearish weekly low close suggests a near-term market top is in place. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at the January high of $1,370.50. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,300.00. First resistance is seen at today’s high of $1,341.30 and then at $1,350.00. First support is seen at last week’s low of $1,330.10 and then at $1,325.00. Wyckoff's Market Rating: 6.0
March Comex silver futures prices closed near mid-range today and did hit a five-week low early on. The silver bears have gained the overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at the January high of $17.705 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 today’s high of $16.865 and then at $17.00. Next support is seen at today’s low of $16.51 and then at $16.25. Wyckoff's Market Rating: 4.0.
March N.Y. copper closed up 250 points at 321.35 cents today. Prices closed near mid-range. The copper bulls have the overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the December high of 332.20 cents. The next downside price objective for the bears is closing prices below solid technical support at the January low of 310.80 cents. First resistance is seen at today’s high of 325.75 cents and then at 328.00 cents. First support is seen at today’s low of 317.05 cents and then at last week’s low of 315.20 cents. Wyckoff's Market Rating: 6.5.