(Kitco News) - Gold and silver prices are solidly down in afternoon U.S. trading Wednesday and sold off more from earlier losses, following an as-expected interest rate cut by the U.S. Federal Reserve. February gold was last down $24.70 at $2,638.10 and March silver was down $0.491 at $30.42. Both markets hit two-week lows just after the FOMC statement.
The Fed’s FOMC committee lowered the main U.S. interest rate by a quarter-point, as widely expected. Some are calling it a “hawkish rate cut.” The FOMC statement said the Fed is now expected to cut rates by a quarter point only twice in 2025. That’s down from four rate cuts the Fed had expected at the last FOMC meeting. The FOMC also upped its inflation forecasts slightly over the next year or two. Traders now await Fed Chair Powell’s press conference, which some expect to see Powell also signal fewer rate cuts next year than previously projected.
The key outside markets today see the U.S. dollar index firmly higher after the FOMC statement, after trading just slightly up before the statement was released. Nymex crude oil futures prices are up and trading around $70.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.45% and up-ticked after the FOMC statement.
Technically, February gold bulls have the overall near-term technical advantage but have faded. Prices are still in an uptrend on the daily bar chart, but just barely. Bulls’ next upside price objective is to produce a close above solid resistance at the December high of $2,761.30. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,600.00. First resistance is seen at today’s high of $2,667.60 and then at Tuesday’s high of $2,675.80. First support is seen $2,635.60 and then at $2,629.70. Wyckoff's Market Rating: 6.5.
March silver futures bulls and bears are on a level overall near-term technical playing field but are fading. Silver bulls' next upside price objective is closing prices above solid technical resistance at the December high of $33.33. The next downside price objective for the bears is closing prices below solid support at $30.00. First resistance is seen at $31.00 and then at this week’s high of $31.24. Next support is seen at the November low of $30.095 and then at $30.00. Wyckoff's Market Rating: 5.0.
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