Gold Down On More Profit-Taking, Bearish Outside Markets!
Gold prices ended the U.S. day session solidly lower Tuesday and closed at the lowest closing level of the month. More profit-taking pressure from recent gains was featured.
Traders and investors are awaiting what is arguably the most important data point of the week and month: the U.S. Federal Reserve’s Open Market Committee (FOMC) meeting that began Tuesday and ends Wednesday afternoon with a statement and press conference from Fed Chair Janet Yellen. No changes in U.S. monetary policy are expected at this meeting, but as always traders and investors will be closely parsing the FOMC statement and Yellen’s comments for clues on Fed policy moves in the coming weeks or months. The marketplace believes there is about a 50-50 chance the Fed will raise interest rates in June.
There was a heavy slate of U.S. economic data due released Tuesday, including retail sales, the producer price index and manufacturing and trade inventories. However, the data had little impact on the precious metals markets.
Technically, April gold futures prices closed near mid-range today. A three-month-old uptrend on the daily bar chart was at least temporarily negated today. Gold bulls still have the overall near-term technical advantage but are fading and need to show fresh power soon. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at this week’s high of $1,261.90. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at 1,200.00. First resistance is seen at today’s high of $1,238.70 and then at $1,250.00. First support is seen at today’s low of $1,226.00 and then at $1,220.00. Wyckoff’s Market Rating: 6.5
Gold edged higher on Wednesday, recovering from its lowest in nearly two weeks although gains were capped as investors waited for the outcome of the Federal Reserve policy meeting.
Spot gold had risen 0.1 percent to $1,233.70 an ounce by 0011 GMT and U.S. gold added 0.3 percent to $1,234.5 an ounce. Spot gold fell to $1,225.70 in the last session, its lowest since March 2.
SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 0.26 percent to 792.23 tonnes on Tuesday from 790.14 tonnes on Monday.
In other news in the precious metals market, Russia plans to hold an auction for the Sukhoi Log gold deposit before the end of this year, Interfax news agency cited Russian Deputy Prime Minister Alexander Khloponin as saying on Tuesday.
The Sukhoi Log deposit, in the Irkutsk region of Siberia, has remained one of the world's largest untapped gold deposits for half a century and Russia has been considering selling rights to the deposit for 20 years.
Reference: Reuters, Kitco
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