Gold Slips on Fed’s Hawkish Comments

(Kitco News) - Gold prices are modestly up in early afternoon U.S. trading Wednesday, but down from daily highs, in the wake of the just-released FOMC statement that leaned a bit hawkish. There is still some safe-haven demand evident after the terrorist strike in Jordan that killed three U.S. soldiers. April gold was last up $7.40 at $2,059.00. March silver was last down $0.105 at $23.09.

The U.S. economic data point of the week saw the just-concluded Open Market Committee meeting of the Federal Reserve release a statement that left interest rates unchanged but said that any rate cuts will not come until the Fed is has “greater confidence” annual inflation is moving toward 2%. The statement also said the U.S. economy is expanding at a “solid” pace. Traders deemed the statement as leaning a bit hawkish, and now await the press conference from Fed Chairman Jerome Powell, set to begin shortly, as of this writing.

Traders will quickly digest the FOMC meeting and start focusing on Friday morning’s monthly U.S. jobs report from the Labor Department.

If the central bankers of the world are really the “smart money” in the global marketplace, gold must be an asset for investors to own. The World Gold Council reports global central banks continued to snatch up gold in 2023 and will continue to do so in 2024. Central banks’ collective purchases in 2023 were 1,037 tons, the WGC said. China’s central bank was the biggest buyer.

U.S. stock index futures were lower in afternoon trading. Risk aversion remains elevated at mid-week after the Iran-backed Houthi drone strike against U.S. troops in Jordan.

The key outside markets today see the U.S. dollar index weaker. Nymex crude oil prices are lower and trading around $76.00 a barrel. Meantime, the yield on the benchmark U.S. Treasury 10-year note is presently fetching 3.982% and down from earlier in the day.

Technically, April gold futures bulls have the overall near-term technical advantage. A six-week-old downtrend on the daily bar chart is now in jeopardy. Bulls’ next upside price objective is to produce a close above solid resistance at $2,100.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,000.00. First resistance is seen at today’s high of $2,074.60 and then at $2,086.70. First support is seen at today’s low of $2,050.90 and then at this week’s low of $2,037.70. Wyckoff's Market Rating: 6.5.

March silver futures bears have the overall near-term technical advantage. A seven-week-old downtrend is in place on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $24.00. The next downside price objective for the bears is closing prices below solid support at the October low of $21.17. First resistance is seen at today’s high of $23.445 and then at $23.72. Next support is seen at this week’s low of $22.88 and then at $22.465. Wyckoff's Market Rating: 3.5.

March N.Y. copper closed down 80 points at 390.25 cents today. Prices closed nearer the session low today and hit a four-week high early on. The copper bulls have the slight overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the December high of 397.40 cents. The next downside price objective for the bears is closing prices below solid technical support at the January low of 371.45 cents. First resistance is seen at today’s high of 394.70 cents and then at 397.40 cents. First support is seen at Tuesday’s low of 386.05 cents and then at this week’s low of 382.75 cents. Wyckoff's Market Rating: 5.5.

This article originally appeared on Kitco News