Gold Pulls Back A Bit After Big Gains Wed

(Kitco News) - Goldpricesare modestly lower in early U.S. trading, on a minor corrective pullbackfrom the strong gains scored Wednesday. Still, the bulls this week have gainedgood momentum to suggest still more upside is likely in the near term. April Comex gold futures were last down $2.60 an ounce at $1,355.40. March Comex silver was last down $0.078 at $16.795 an ounce.

Thejust-released January U.S. producer price index report came in at up 0.4% fromDecember, with the “core” reading also up 0.4%. The January PPI was forecast tocome in at up 0.4% from December on the headline number, and up 0.2% excludingfood and energy, or the core. Metals prices moved little on this news, afterseeing volatility in the aftermath of Wednesday’s consumer price index report.

Globalstock markets were mostly higher overnight and mostly overlooked the volatilityseen in the U.S. stock market Wednesday. U.S. stock indexes are pointed toward higheropenings when the New York day session begins.

Chinaand South Korean markets were closed Thursday for the Lunar New Year holiday.

Thekey outside markets on Thursday morning see the U.S. dollar index lower again.The greenback is taking a beating this week and the USDX is now back close tothe multi-year low scored in January. The weak dollar will limit sellingpressure on the metals today. Meantime, Nymex crude oil prices are slightly lowerand trading just above $60.00 a barrel.

OtherU.S. economic data due for release Thursday includes the weekly jobless claimsreport, the Empire State manufacturing survey, the Philadelphia Fed businesssurvey, industrial production and capacity utilization, the NAHB housing marketindex, and Treasury international capital data.

Technically,Aprilgold futures bulls have the overall near-term technical advantage andgained more power with Wednesday’s surge. Bulls’ next upside technicalobjective is pushing and closing prices above chart resistance at the Januaryhigh of $1,370.50. Bears' next near-term downside price breakout objective isclosing prices below solid technical support at $1,320.00. First support isseen at $1,350.00 and then at $1,340.00. First resistance is seen at today’shigh of $1,359.80 and then at $1,370.50. Wyckoff’s Market Rating: 6.5

Marchsilver bears have the slight overall near-term technical advantage. However, afledgling downtrend on the daily chart has been negated. The next upside price breakoutobjective is closing futures prices above solid technical resistance at $17.00an ounce. The next downside price breakout objective for the bears is closingprices below solid support at the February low of $16.13. First resistance isseen at today’s high of $16.95 and then at $17.00. Next support is seen at $16.75and then at $16.50. Wyckoff's Market Rating: 4.5.

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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