Gold prices are slightly lower in early trading Monday, on some profit-taking pressure and chart consolidation from recent gains that saw prices hit another six-month high overnight. The markets are digesting well, so far, the news that Crimean citizens on Sunday voted to secede from Ukraine. April gold was last down $3.70 at $1,375.20 an ounce. Spot gold was last quoted down $5.10 at $1,377.50. May Comex silver last traded down $0.213 at $21.21 an ounce.

A referendum Sunday saw Crimean voters overwhelmingly choose to secede from Ukraine and be annexed by Russia. The vote results were not surprising. The Russian parliament said it would move quickly to annex the Crimean region. There was no major violence during or following the referendum—just jawboning from the West on the matter. Judging from the market place’s somewhat surprising “ho-hum” reaction to the Crimean vote and the situation overall on Monday morning, it appears the matter is fading to a back-burner issue. Any escalation of tensions in Ukraine would quickly put risk-aversion back into the market place, however. Look for this week to see the U.S. and European Union slap Russia’s hands with diplomatic and economic sanctions.

In other overnight news, the European Union’s inflation rate in February was up 0.3% in February from January, and up 0.7% year-on-year. The figures were below market expectations and raise the specter of further monetary policy stimulus from the European Central Bank, as the rate of EU inflation is well below the ECB’s target of 2.0% per year.

Focus of the market place is turning to this week’s meeting of the U.S. Federal Reserve’s Open Market Committee (FOMC), taking place Tuesday and Wednesday. Fed Chair Janet Yellen will deliver her first press conference after the FOMC meeting’s conclusion Wednesday afternoon. It is expected the FOMC will continue on its “tapering” program, whereby monthly bond purchases are whittled down by $10 billion a month.

U.S. economic data due for release Monday includes the Empire State manufacturing survey, Treasury international capital data, industrial production and capacity utilization, and the NAHB housing market index. A major snowstorm in Washington, D.C. Monday could delay some of this data.

Wyckoff’s Daily Risk Rating: 6.0 (The Ukraine situation has for the moment de-escalated and has become a tertiary market factor. That could change this week, however.)

(Wyckoff’s Daily Risk Rating is your way to quickly gauge investor risk appetite in the world market place each day. Each day I assess the “risk-on” or “risk-off” trader mentality in the market place with a numerical reading of 1 to 10, with 1 being least risk-averse (most risk-on) and 10 being the most risk-averse (risk-off), and 5 being neutral.

The London A.M. gold fix is $1,379.00 versus the P.M. fixing of $1,385.00.

Technically, April gold futures prices are in a 2.5-month-old uptrend on the daily bar chart and have just hit another six-month high. The gold bulls have the near-term technical advantage. Bulls’ next upside near-term price breakout objective is to produce a close above technical resistance at $1,400.00. Bears' next near-term downside breakout price objective is closing prices below technical support at $1,355.00. First resistance is seen at the overnight high of $1,392.60 and then at $1,400.00. First support is seen at the overnight low of $1,375.00 and then at Friday’s low of $1,368.20.  

May silver futures bears have the slight near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at the March high of $21.74 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at the March low of $20.61. First resistance is seen at the overnight high of $21.65 and then at Friday’s high of $21.795. Next support is seen at $21.00 and then at $20.61.

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