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

(Kitco News) - Gold prices ended 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 the U.S. dollar index hit the gold and silver markets today. Higher world government bond yields also worked against the precious metals market bulls today. 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.

Global stock markets were mostly lower Tuesday, including U.S. stock indexes. China markets are still closed for a holiday. Rising world government bond yields are also prompting selling pressure in equities early this week. Tuesday saw somewhat volatile trading day in the U.S. stock market. Higher volatility in the stock market this week could limit selling pressure, and even invite buying interest into the safe-haven gold and silver markets.

The key outside markets on saw the U.S. dollar index firmly higher on a corrective rebound from recent strong selling pressure. The dollar index did hit a three-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-term technical advantage. The Euro currency bulls also have the firm near-term technical advantage.

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

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

Technically, April gold futures prices closed the day session near the daily low. No serious chart damage was inflicted today, but the bulls need to step up and show fresh power soon. The gold bulls still have the overall near-term technical advantage. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at the January high of $1,370.50. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the February low of $1,309.00. First resistance 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

March silver futures prices closed nearer the session low. The silver bears have the slight overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $17.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $16.00. First resistance is seen at today’s high of $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.

March N.Y. copper closed down 625 points at 318.60 cents today. Prices closed near the session low. The copper bulls still have the 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 323.65 cents. The next downside price objective for the bears is closing prices below solid technical support at the February low of 302.60 cents. First resistance is seen at 320.00 cents and then at today’s high of 324.60 cents. First support is seen at today’s low of 318.05 cents and then at 315.00 cents. Wyckoff's Market Rating: 6.5.