Gold, Silver See Modest Gains As World Stock Markets Tumble

(Kitco News) - Gold and silver markets are modestly higher in early U.S. trading Monday, on a bitof safe-haven demand as world equity markets are under strong selling pressure.A stabilized U.S. dollar index is limiting the upside in the precious metalsmarkets early this week. April Comex gold futures were last up $2.30 an ounceat $1,339.70. March Comex silver was last up $0.116 at $16.825 an ounce.

Worldstock markets were mostly lower overnight. U.S. stock indexes are pointedtoward solidly lower openings when the New York day session begins. The U.S.stock indexes have become very wobbly. Bearish weekly low closes in the indexeslast Friday were a technical clue that near-term market tops are in place. Worriesabout rising interest rates and inflation worldwide, as evidenced by risingworld bond yields, have spooked the global equities markets.

Lookfor more gains in the safe-haven gold and silver markets if the world stockmarkets remain under pressure this week. Money flows out of paper assets(stocks and bonds) will benefit the hard assets, including precious metals.Steady money flows out of the overly inflated world stock markets wouldcontinue to support the metals, and quite possibly for quite some time to come.

Thekey “outside markets” on Monday morning see the U.S. dollar index near steady.The recent selling pressure has appeared to stabilize. Meantime, Nymex crude oil prices are weaker and trading just below $65.00 a barrel.

Inother news, the new Federal Reserve chairman, Jerome Powell, will be sworn intoday.

U.S.economic data due for release Monday includes the U.S. services purchasingmanagers index (PMI) the employment trends index, the ISN non-manufacturingreport on business, and the global services PMI.

Technically,Aprilgold futures bulls still have the overall near-term technical advantage,but are fading and need to show fresh power soon. An uptrend on the daily barchart has been at least temporarily halted. The bearish weekly low close lastFriday is one chart clue that a near-term market top is in place. Bulls’ nextupside technical objective is pushing and closing prices above chart resistanceat the January high of $1,370.50. Bears' next near-term downside price breakoutobjective is closing prices below solid technical support at $1,310.00. First supportis seen at last week’s low of $1,330.10 and then at $1,325.00. First resistanceis seen at $1,350.00 and then at $1,354.30. Wyckoff’s Market Rating: 6.0

March silver prices hit a five-week low overnight. Bears have gained the overallnear-term technical advantage. Prices last Friday produced a technicallybearish weekly low close. The next upside price breakout objective is closingfutures prices above solid technical resistance at the January high of $17.705an ounce. The next downside price breakout objective for the bears is closingprices below solid support at $16.00. First resistance is seen at today’s highof $16.865 and then at $17.00. Next support is seen at today’s low of $16.51and then at $16.25. Wyckoff's Market Rating: 4.0.

By Jim Wyckoff

For Kitco News

Follow @jimwyckoffjwyckoff@kitco.comwww.kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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