Gold price firmer just ahead of FOMC rate decision
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(Kitco News) - Gold and silver prices are a bit higher in early U.S. trading Wednesday, as traders and investors anxiously await the conclusion of one of the most highly anticipated U.S. Federal Reserve Open Market Committee (FOMC) meetings in years. April gold was last up $2.20 at $1,943.50 and May silver was up $0.05 at $22.475.
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward mixed openings when the New York day session begins. Focus at mid-week is on the Federal Reserve's FOMC meeting that began Tuesday morning and concludes Wednesday afternoon. There is still last-minute debate regarding whether the Fed will raise its main interest rate by 25 basis points or stand pat amid the U.S. and European banking problems. Most market watchers are leaning toward a 0.25% Fed funds rate increase. The Bank of England holds is regular monetary policy meeting Thursday.
The U.S. and European bank turmoil is still a dark cloud hanging over the marketplace and curtailing risk appetite. Said market analyst Craig Erlam of OANDA: "It very much feels like we're just taking one day at a time…. Every day that passes without drama is one closer to the point at which we can put the mini-banking crisis behind us. But it's still early days and investors are all too aware of that, which is why we're seeing a tentative recovery at this point."
|Gold Prices Remain Resilient Despite Banking Crisis Resolution: Invesco's Kristina Hooper|
The key outside markets today see the U.S. dollar index lower. Nymex crude oil futures prices are slightly lower and are trading around $69.25 a barrel, after hitting a 15-month low Monday. The benchmark 10-year U.S. Treasury note yield is presently fetching 3.604%.
Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey and the weekly DOE liquid energy stocks report.
Technically, the gold futures bulls have the firm overall near-term technical advantage. Bulls' next upside price objective is to produce a close in April futures 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 $1,950.00 and then at $1,975.20. First support is seen at the overnight low of $1,936.50 and then at $1,925.00. Wyckoff's Market Rating: 7.5
The silver bulls have the overall near-term technical advantage. Silver bulls' next upside price objective is closing May futures 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 this week's low of $22.29 and then at $22.00. Wyckoff's Market Rating: 6.5.