Gold, Silver Weaker As Fed Rate Hike Taken In Stride

(Kitco News) - Gold and silver prices are modestly lower in afternoon U.S. trading Wednesday and are seeing some pressure from a rebound in the U.S. dollar index today and on continued upbeat trader and investor risk attitudes. This afternoon’s FOMC meeting concluded with an interest rate hike, but it had little impact on the metals or other markets. December gold futures were last down $2.40 an ounce at $1,202.40. December Comex silver was last down $0.043 at $14.45 an ounce.

The much-anticipated conclusion of the two-day FOMC meeting that began Tuesday morning and ended just a while ago saw the Fed slightly raise U.S. interest rates, by 0.25%, as expected and marking the third rate rise this year. The Fed is on pace to raise rates another quarter-point this year and then three times in 2019. The Fed said its long-term inflation prospects remain unchanged, and non-problematic, despite the recent strong U.S. economic growth. Fed Chairman Jerome Powell will hold a press conference soon. As usual, the marketplace will parse the Fed’s and Powell’s wording for clues on the pace of future Fed rate hikes and the Fed’s inflation expectations.

Focus in Europe is now on the new Italian government’s economic plans to address its fiscal and financial problems, which are required by European Union law. Many believe Italian lawmakers won’t comply with EU rules on the matter.

The key outside markets today find the U.S. dollar index slightly higher on an upside correction from recent selling pressure. Meantime, November Nymex crude oil prices are lower and trading just below $72.00 a barrel. Supply worries have boosted oil recently. U.S. sanctions against Iran begin in early November, which will likely take much of that country’s oil off the world market. President Trump has singled out Iran in front of the United Nations this week as being a terrorist state that needs heavy economic sanctions. Trump also called out the OPEC oil cartel for holding prices artificially high, saying OPEC countries may not get financial or military support from the U.S. 

Technically, the gold bears still have the overall near-term technical advantage. However, prices have been trading sideways for the past month, which begins to suggest a market bottom is in place. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,220.70. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the August low of $1,167.10. First resistance is seen at $1,210.00 and then at $1,215.80. First support is seen at last week’s low of $1,196.00 and then at the September low of $1,192.70. Wyckoff's Market Rating: 3.0

The silver bears still have the firm overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $15.07 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $13.50. First resistance is seen at this week’s high of $14.595 and then at $14.75. Next support is seen at this week’s low of $14.22 and then at last week’s low of $14.065. Wyckoff's Market Rating: 3.0.

December N.Y. copper closed up 95 points at 283.45 cents today. Prices closed nearer the session high today. The copper bears have the overall near-term technical advantage, but recent good gains suggest a market bottom is in place. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the 295.00 cents. The next downside price objective for the bears is closing prices below solid technical support at the August low of 257.45 cents. First resistance is seen at Tuesday’s high of 284.80 cents and then at last week’s high of 287.10 cents. First support is seen at this week’s low of 278.90 cents and then at 275.00 cents. Wyckoff's Market Rating: 4.0.