(Kitco News) - Gold prices are modestly weaker in early U.S. trading Tuesday, while silver trades slightly up, following a key U.S. inflation report that came in just a bit warmer than market expectations and prompted some profit taking. April gold was last down $2.10 at $2,186.20. May silver was last up $0.065 at $24.775. It appears the gold and silver market bulls are stepping in to buy the overnight dips.
The U.S. data point of the week saw the consumer price index for February come in just a bit warmer than expected, at up 3.2%, year-on-year, versus market expectations for a rise of 3.1%, and compares to a rise of 3.1% seen in the January report. The core CPI number for February was up 3.8% compared to expectations of up 3.7% and up 3.9% seen in the January report. The slightly warmer CPI readings did not have a significant impact on the markets. Traders and investors reckon today’s CPI numbers will not change the trajectory of Federal Reserve monetary policy.
JP Morgan chief Jamie Dimon said overnight the Federal Reserve should wait until after June to lower interest rates. Dimon, visiting Australia, also told a group that the U.S. stock market could be in a bubble phase, adding to be extra cautious when an investment looks so obvious.
Asian and European stock markets were mixed in overnight trading. U.S. stock index futures are set to open higher when the New York day session begins.
The key outside markets today see the U.S. dollar index a bit lower. Nymex crude oil prices are near steady and trading around $78.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently fetching 4.089%.
Other U.S. economic data due for release Tuesday includes the weekly Johnson Redbook retail sales report, the NFIB small business index and the monthly Treasury budget statement.
Technically, the gold futures bulls have the solid overall near-term technical advantage. A steep four-week-old uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close in April futures above solid resistance at $2,250.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,100.00. First resistance is seen at this week’s high of $2,195.50 and then at the contract high of $2,203.00. First support is seen at today’s low of $2,165.80 and then at $2,150.00. Wyckoff's Market Rating: 8.5.
The silver bulls have the overall near-term technical advantage and have momentum. Silver bulls' next upside price objective is closing May futures prices above solid technical resistance at $26.00. The next downside price objective for the bears is closing prices below solid support at $23.50. First resistance is seen at last week’s high of $24.86 and then at $25.00. Next support is seen at today’s low of $24.43 and then at $24.00. Wyckoff's Market Rating: 6.5.
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