Gold Hit Hard By Heavy Profit Taking, But No Chart Damage

(Kitco News) - Gold pricesended the U.S. day session sharply down and near the daily low Tuesday.Heavy profit-taking pressure from recent gains and a solid daily rally in theU.S. dollar index hit the gold and silver markets today. Higher worldgovernment bond yields also worked against the precious metals market bullstoday. April Comex gold futures were last down $24.30 an ounce at $1,331.90.March Comex silver was last down $0.282 at $16.43 an ounce.

Globalstock markets were mostly lower Tuesday, including U.S. stock indexes. Chinamarkets are still closed for a holiday. Rising world government bond yields arealso prompting selling pressure in equities early this week. Tuesday sawsomewhat volatile trading day in the U.S. stock market. Higher volatility inthe stock market this week could limit selling pressure, and even invite buyinginterest into the safe-haven gold and silver markets.

Thekey outside markets on saw the U.S. dollar index firmly higher on a correctiverebound from recent strong selling pressure. The dollar index did hit athree-year low last week, with the Euro currency pushing to a three-year high. Still,the USDX is in a price downtrend and the bears have the overall near-termtechnical advantage. The Euro currency bulls also have the firm near-termtechnical advantage.

Meantime,Nymex crude oil prices were slightly firmer early this afternoon and tradingjust below $62.00 a barrel.

Therewere no major U.S. economic reports due for release Tuesday but the pace picksup quickly Wednesday. Traders and investors are awaiting Wednesday afternoon'sminutes from the latest Federal Reserve Open Market Committee (FOMC) meeting.Previous FOMC minutes reports have been markets-movers.

Technically,Aprilgold futures prices closed the day session near the daily low. No seriouschart damage was inflicted today, but the bulls need to step up and show freshpower soon. The gold bulls still have the overall near-term technicaladvantage. Gold bulls' next upside near-term price breakout objective is toproduce a close above solid technical resistance at the January high of$1,370.50. Bears' next near-term downside price breakout objective is pushingprices below solid technical support at the February low of $1,309.00. Firstresistance is seen at $1,340.00 and then at $1,350.00. First support is seen at$1,325.00 and then at $1,320.00. Wyckoff's Market Rating: 6.5

Marchsilver futures prices closed nearer the session low. The silver bears have theslight overall near-term technical advantage. Silver bulls' next upside pricebreakout objective is closing prices above solid technical resistance at $17.00an 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 $16.69 and then at last week's high of $16.95. Next support is seen at$16.325 and then at $16.25. Wyckoff's Market Rating: 4.5.

MarchN.Y. copper closed down 625 points at 318.60 cents today. Prices closed nearthe session low. The copper bulls still have the overall near-term technicaladvantage. Copper bulls' next upside price objective is pushing and closingprices above solid technical resistance at the December high of 323.65 cents.The next downside price objective for the bears is closing prices below solidtechnical support at the February low of 302.60 cents. First resistance is seenat 320.00 cents and then at today's high of 324.60 cents. First support is seenat today's low of 318.05 cents and then at 315.00 cents. Wyckoff's MarketRating: 6.5.

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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