Gold, Silver Prices Drop On Higher U.S. Dollar, Better Risk Appetite

(Kitco News) - Gold and silver prices were solidly lower in midday U.S. trading Wednesday. A rebound inthe U.S. dollar index at mid-week and an uptick in investor risk appetite todayhad the sellers of the metals in control. April Comex gold futures were lastdown $15.60 an ounce at $1,326.40. May Comex silver was last down $0.276 at$16.265 an ounce.

Whileworld stock markets were mostly lower overnight, after the U.S. stock indexestook a downside hit Tuesday, the U.S. indexes stabilized at midday today.However, world stock markets have become wobbly again. There are mountingtechnical clues the U.S. stock indexes have put in major tops. Such would be alonger-term bullish development for the gold and silver markets, which are acompeting asset class with equities.

Today’sfinal revision of the four-quarter U.S. gross domestic product showed a rise of2.9% on an annual basis, which beat market expectations for a growth rate of2.7% and was better than the last estimate for the fourth quarter, which showeda rise of 2.5%. Today’s rise in 4Q GDP compares with a rise of 3.2% in thethird quarter and a gain of 3.1% in the second quarter of 2017. Economists areoptimistic U.S. GDP growth can remain above 3.0% in 2018, due to corporate taxcuts adding to an already strengthening U.S. economy.

Thekey “outside markets” on Wednesday saw the U.S. dollar index solidly higher.Trading in the USDX has been choppy recently, but the near-term price trendremains sideways to lower. Meantime, Nymex crude oil prices were down on moreprofit taking from recent gains, and trading just above $64.00 a barrel.

Technically,Aprilgold futures bulls still have the slight overall near-term technicaladvantage, but are fading and need to show fresh power soon to keep it. Goldbulls' next upside near-term price breakout objective is to produce a closeabove solid technical resistance at this week’s high of $1,356.80. Bears' nextnear-term downside price breakout objective is pushing prices below solidtechnical support at $1,300.00. First resistance is seen at $1,330.00 and thenat $1,335.00. First support is seen at today’s low of $1,324.50 and then at$1,320.00. Wyckoff's Market Rating: 5.5

May silver futures bears have the overall near-term technical advantage and haveregained downside momentum. Silver bulls' next upside price breakout objectiveis closing prices above solid technical resistance at $17.00 an ounce. The nextdownside price breakout objective for the bears is closing prices below solidsupport at $16.00. First resistance is seen at today’s high of $16.56 and thenat this week’s high of $16.81. Next support is seen at today’s low of $16.23and then at the March low of $16.10. Wyckoff's Market Rating: 3.0.

MayN.Y. copper closed up 30 points at 300.35 cents today. Prices closed nearer thesession high today and saw more short covering after hitting a six-month low onMonday. The copper bears have the overall near-term technical advantage. Pricesare in a six-week-old downtrend on the daily bar chart. Copper bulls' nextupside price objective is pushing and closing prices above solid technicalresistance at 310.00 cents. The next downside price objective for the bears isclosing prices below solid technical support at the September low of 293.25cents. First resistance is seen at this week’s high of 302.40 cents and 305.00cents. First support is seen at today’s low of 296.85 cents and then at thisweek’s low of 293.75 cents. 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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