Gold sees heavy profit taking, position evening as Fed decision looms
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(Kitco News) - Gold prices are sharply lower and silver moderately down in midday U.S. trading Tuesday. Heavy profit-taking pressure and position evening from the futures traders is featured ahead of the U.S. interest rate decision Wednesday afternoon. Also negative for gold and silver on this day is trader and investor risk appetite that has up-ticked just a bit. April gold was last down $35.90 at $1,947.10 and May silver was down $0.221 at $22.425.
Focus is on the Federal Reserve’s FOMC meeting that begins Tuesday morning and concludes Wednesday afternoon. There is still debate in the marketplace regarding whether the Fed will raise its main interest rate by 25 basis points or stand pat amid the U.S. and European banking crisis. With today’s calmer marketplace, more market watchers are leaning toward a 0.25% Fed funds rate increase. The 0.5% rate hike by the European Central Bank last week also makes a 0.25% increase by the FOMC more likely.
Global stock markets were mixed to higher overnight. U.S. stock indexes are higher at midday. Risk appetite is a bit better Tuesday as the U.S. and European banking turmoil continues to play out. Reports say JP Morgan bank chief Jamie Dimon is helping the troubled First Republic Bank through its crisis of investor/depositor confidence.
|Gold Prices Remain Resilient Despite Banking Crisis Resolution: Invesco's Kristina Hooper|
The key outside markets today see the U.S. dollar index near steady. Nymex crude oil futures prices are firmer and are trading around $68.75 a barrel, after hitting a 15-month low Monday. The benchmark 10-year U.S. Treasury note yield is presently fetching 3.571%--up from levels seen Monday, which is an indication of less anxiety in the marketplace Tuesday.
Technically, April gold futures bulls still have the firm overall near-term technical advantage. Prices are in a fledgling uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at this week’s high of $2,014.90. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,900.00. First resistance is seen at $1,975.20 and then at today’s high of $1,988.70. First support is seen at $1,935.00 and then at $1,922.70. Wyckoff's Market Rating: 7.5
May silver futures bulls have the overall near-term technical advantage. Prices are in a fledgling uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $23.50. The next downside price objective for the bears is closing prices below solid support at $21.00. First resistance is seen at this week’s high of $22.855 and then at $23.00. Next support is seen at $22.00 and then at $21.75. Wyckoff's Market Rating: 6.5.
May N.Y. copper closed up 305 points at 398.25 cents today. Prices closed near mid-range today. The copper bears still have the overall near-term technical advantage. Prices are in a two-month-old downtrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the March high of 417.25 cents. The next downside price objective for the bears is closing prices below solid technical support at 372.00 cents. First resistance is seen at today’s high of 403.45 cents and then at 408.00 cents. First support is seen at today’s low of 392.85 cents and then at this week’s low of 385.50 cents. Wyckoff's Market Rating: 4.0.