Gold Pauses Ahead Of FOMC Minutes

(Kitco News) - Gold prices are trading steady to slightly lower in early U.S. trading Wednesday. Theyellow metal is pausing after Tuesday's shellacking and ahead of thisafternoon's release of the latest minutes from the Federal Open MarketCommittee meeting. April Comex gold futures were last down $1.40 an ounce at$1,329.80. March Comex silver was last down $0.058 at $16.38 an ounce.

Thehighlight of the trading week will be the release of the FOMC minutes, whichare due out at 2:00 p.m. eastern time. Past FOMC minutes releases have beenmarkets-movers. Keep in mind the last FOMC meeting occurred before the bigincrease in volatility in the stock markets. Traders and investors will beespecially keen to see what the FOMC members said about inflation.

Globalstock markets were mostly lower overnight. U.S. stock indexes are pointedtoward narrowly mixed openings when the New York day session begins. Volatilityin the U.S. stock market picked up Tuesday, and traders are wondering if suchwill continue today.

Inovernight news, the Euro zone's Markit composite purchasing managers index(PMI) fell to 57.5 in February versus 58.8 in January, for a three-month low.The weaker February number was in line with market expectations.

Thekey outside markets on Wednesday morning see the U.S. dollar index firmer on a correctiverebound from recent selling pressure. The dollar index hit a three-year lowlast week. Meantime, Nymex crude oil prices are weaker early today and tradingjust above $61.00 a barrel.

OtherU.S. economic data due for release Wednesday includes the weekly JohnsonRedbook and Goldman Sachs retail sales reports, the weekly MBA mortgage applicationssurvey, the U.S. flash services and manufacturing PMI numbers, and existinghome sales.

Technically,Aprilgold futures bulls still have the overall near-term technical advantage,but are fading and need to show fresh power soon in order to avoid seriousnear-term technical damage being inflicted. Bulls' next upside technicalobjective is pushing and closing prices above chart resistance at $1,350.00. Bears'next near-term downside price breakout objective is closing prices below solidtechnical support at the February low of $1,309.00. First resistance is seen atthe overnight high of $1,332.90 and then at $1,340.00. First support is seen at$1,325.00 and then at $1,320.00. Wyckoff's Market Rating: 6.0

Marchsilver bears have the overall near-term technical advantage. Prices are in athree-week-old downtrend on the daily bar chart. 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 16.50 and then at this week's high of $16.69. Next support is seen atthe overnight low of $16.34 and 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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