Gold, silver sink on more clues of Fed being hawkish for longer
(Kitco News) - Gold and silver prices are solidly lower in midday U.S. trading Thursday. Gold hit a seven-week low and silver is poised to close at a seven-week low close. Bearish for metals are more signals late this week the U.S. Federal Reserve will keep interest rates higher for longer. That has negative demand implications for the metals markets. April gold was last down $12.90 at $1,828.60 and March silver was down $0.337 at $21.34.
The inflation components of today’s updated fourth-quarter U.S. gross domestic product report came in a little hotter than expected, which briefly pushed U.S. bond yields still higher and supported gains in the U.S. dollar index. This news follows the FOMC minutes that were released Wednesday afternoon. The marketplace deemed those minutes as leaning slightly more hawkish than expected, as there were a few FOMC members that wanted a 50-basis-point hike in the Fed fund range at the January meeting. That meeting saw a 25-basis-point rise. The marketplace takeaway from the FOMC minutes and the GDP inflation components is that the Fed will keep its monetary policy hawkish for longer, to effectively tamp down problematic price inflation.
Global stock markets were mixed but mostly firmer overnight. U.S. stock indexes are lower at midday.
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The key outside markets this morning see the U.S. dollar index higher. Nymex crude oil futures prices are higher and trading around $75.00 a barrel. The yield on the benchmark U.S. 10-year Treasury note is presently fetching 3.897%.
Technically, April gold futures prices hit a seven-month low today. Bears have the overall near-term technical advantage. A price downtrend is in place on the daily chart. Bulls’ next upside price objective is to produce a close above solid resistance at last week’s high of $1,881.60. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,800.00. First resistance is seen at today’s high of $1,841.20 and then at this week’s high of $1,856.40. First support is seen at today’s $1,824.80 and then at $1,815.00. Wyckoff's Market Rating: 4.0
March silver futures were poised to close at a seven-week-low close today. The silver bears have the overall near-term technical advantage. Prices are in a steep downtrend on the daily bar chart. 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 $20.00. First resistance is seen at today’s high of $21.67 and then at this week’s high of $22.00. Next support is seen at the February low of $21.155 and then at $21.00. Wyckoff's Market Rating: 4.0.
March N.Y. copper closed down 1,365 points at 405.45 cents today. Prices closed near the session low today. The copper bulls have the overall near-term technical advantage but they faded a bit today. 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 the February low of 397.85 cents. First resistance is seen at 415.00 cents and then at this week’s high of 423.70 cents. First support is seen at today’s low of 405.05 cents and then at 400.00 cents. Wyckoff's Market Rating: 6.5.