Gold, silver punished by stronger USDX, falling crude oil
(Kitco News) - Gold and silver prices are solidly lower in midday U.S. trading Wednesday. Gold hit a nine-week low and silver a 2.5-month low today. The key outside markets were in a bearish daily posture for the metals markets at mid-week, as the U.S. dollar index was sharply higher and crude oil prices were lower. April gold was last down $23.30 at $1,842.00 and March silver was down $0.333 at $21.54.
The marketplace is a bit unsettled at mid-week, following a U.S. consumer price index report on Tuesday that was just slightly above market expectations. Also, the U.S. data point of the day Wednesday saw retail sales rise a stronger-than-expected 3.0% in January from December. The report was expected to come in up 1.9%, following a decline of 1.1% in December from November. The takeaway from Tuesday’s CPI report and today’s retail sales data appears to be that the Federal Reserve has more heavy lifting to do in the coming months to slow down the U.S. economy and crimp consumer and commercial demand to get inflation down to the level the Fed desires, which is around 2% annually. The U.S. producer price index report is Thursday. This scenario is a bearish one for the metals, from a global demand perspective.
Global stock markets were mixed overnight, with Asian shares mostly lower and European shares mostly higher. U.S. stock indexes are weaker at midday.
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The key outside markets see the U.S. dollar index solidly higher. Nymex crude oil futures prices are lower and trading around $77.50 a barrel. The yield on the benchmark U.S. 10-year Treasury note is presently fetching around 3.75%.
Technically, April gold futures prices hit a six-week low today. Bulls have lost their slight overall near-term technical advantage. A fledgling downtrend is in place on the daily chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,900.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,800.00. First resistance is seen at $1,850.00 and then at today’s high of $1,870.90. First support is seen at today’s low of $1,839.30 and then at $1,830.00. Wyckoff's Market Rating: 5.0
March silver futures prices hit a 2.5-month low today. The silver bears have the overall near-term technical advantage and have momentum on their side. Silver bulls' next upside price objective is closing prices above solid technical resistance at $23.00. The next downside price objective for the bears is closing prices below solid support at $21.00. First resistance is seen at today’s high of $21.875 and then at this week’s high of $22.085. Next support is seen at today’s low of $21.385 and then at $21.00. Wyckoff's Market Rating: 4.0.
March N.Y. copper closed down 680 points at 400.65 cents today. Prices closed nearer the session low and hit a five-week low. The copper bulls have the slight overall near-term technical advantage. However, a fledgling price downtrend is in place on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the January high of 435.50 cents. The next downside price objective for the bears is closing prices below solid technical support at 380.00 cents. First resistance is seen at this week’s high of 411.10 cents and then at 417.50 cents. First support is seen at today’s low of $3.9785 and then at 390.00 cents. Wyckoff's Market Rating: 5.5.