Gold, Silver Prices Slip As U.S., World Stock Markets Remain Resilient
(Kitco News) - Gold and silver prices are moderately lower in early-afternoon U.S. trading Thursday. Despite a couple geopolitical speed bumps this week, traders and investors worldwide remain in generally upbeat moods and that’s a negative for the safe-haven metals. Profit taking from the shorter-term futures traders was also featured in both metals today. April gold futures were last down $4.80 an ounce at $1,316.40. May Comex silver was last down $0.142 at $15.53 an ounce.
U.S. stock indexes were just slightly down at midday Thursday, and not far below this week’s three-month highs—an indication of still-keen trader and investor demand despite a couple of geopolitical events this week.
Some risk aversion briefly crept back into the marketplace Thursday as the U.S.-North Korea nuclear summit in Vietnam has ended abruptly with no agreement after North Korea’s leader Kim Jong Un demanded an end to sanctions on his country and would not agree to U.S. President Trump’s demands to de-nuclearize. However, the two leaders apparently left the meeting on good terms, which assuaged the marketplace following some uneasiness in overnight trading.
There is another geopolitical development that has the attention of the world marketplace this week. India and Pakistan this week exchanged military strikes on each other. India bombed what it said was a terrorist camp in Pakistan, with Pakistan retaliating by shooting down two Indian aircraft. This news has Asian stock and financial markets jittery. Any escalation of this situation will prompt significant safe-haven demand for gold and silver.
Today’s release of the fourth-quarter U.S. GDP report showed a slightly stronger-than-expected rise of 2.6%, on an annual basis. That compares to trade expectations of a rise of 2.2%. Gold prices down-ticked a bit after that report.
There was weak manufacturing data coming out of China today, as its official purchasing managers’ index fell to 49.2 in February, down from 49.5 in January. A reading below 50.0 shows contraction in the sector. U.S. trade sanctions on China have hurt its economy. That could be read as bearish for gold, as China’s population is a leading gold consumer.
On an upbeat note, U.S. Trade Representative Lighthizer told a congressional committee on Wednesday that the U.S. and China are moving closer to a trade deal and that any new U.S. tariffs on China would be delayed from the March 1 original implementation.
The key outside markets today see the U.S. dollar index slightly higher. However, the greenback bulls have faded a bit this week. Nymex crude oil prices are firmer and trading just above $57.00 a barrel.
Technically, April gold futures prices closed nearer the session low. The bulls still have the overall near-term technical advantage, but need to show fresh power soon to keep a 3.5-month-old price uptrend in place on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,350.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the February low of $1,304.70. First resistance is seen at today’s high of $1,328.90 and then at this week’s high of $1,334.90. First support is seen at today’s low of $1,314.50 and then at $1,310.00. Wyckoff's Market Rating: 6.5
May silver futures prices closed near the session low today. The silver bulls still have the slight overall near-term technical advantage but are fading. More selling pressure in the near term would see a bearish double-top reversal pattern confirmed. Prices are still in a 3.5-month-old price uptrend on the daily bar chart, but now just barely. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at last week’s high of $16.295 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the February low of $15.545. First resistance is seen at today’s high of $15.86 and then at $16.00. Next support is seen at $15.545 and then at the January low of $15.28. Wyckoff's Market Rating: 5.5.
May N.Y. copper closed down 200 points at 294.30 cents today. Prices closed nearer the session low today on profit taking from recent good gains. The copper bulls have the overall near-term technical advantage. Prices have been trending higher for two months. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 300.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 275.00 cents. First resistance is seen at this week’s high of 297.75 cents and then at 300.00 cents. First support is seen at this week’s low of 293.45 cents and then at 290.00 cents. Wyckoff's Market Rating: 6.5.