Gold prices ended the U.S. day session higher Wednesday, on more chart-based buying and safe-haven demand. Weaker U.S. stock indexes Wednesday invited some safe-haven demand for gold. The bulls are in firm near-term technical command, which is inviting more chart-based buying and suggests the path of least resistance for prices will remain sideways to higher. April Comex gold was last up $10.70 at $1,241.60 an ounce. May Comex silver was last up $0.249 at $15.005 an ounce.
There were rumors in the marketplace Wednesday that Saudi Arabia is in some financial trouble. Reports said Saudi Arabia is asking banks for a $10 billion loan. This news also likely added some buying interest to safe-haven gold.
Technically, April gold futures prices closed nearer the session high. Prices are in a 2.5-month-old uptrend on the daily bar chart and bulls have the firm 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 February high of $1,263.90. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at 1,212.00. First resistance is seen at this week’s high of $1,249.30 and then at $1,254.30. First support is seen at $1,230.00 and then at today’s low of $1,225.10. Wyckoff’s Market Rating: 7.5
Gold futures on the COMEX division of the New York Mercantile Exchange rose on Wednesday as U.S. equities fell slightly.
The most active gold contract for April delivery added 11 U.S. dollars, or 0.89 percent, to settle at 1,241.80 dollars per ounce.
Gold was given support as the U.S. Dow Jones Industrial Average fell by 14 points, or 0.08 as of 17:30 GMT. Analysts note that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.
The precious metal was prevented from rising further as the U.S.-based Automated Data Processing employment report showed better-than-expected numbers, which rose to a 214,000 level ahead of the big jobs report due on Friday. Analysts note that this strength would normally boost equities and put extensive pressure on gold, but the weakness in oil is putting pressure on the market on Wednesday.
Traders are waiting for the weekly jobless claims report to be released on Thursday, along with international trade and the big jobs report to be released on Friday. Despite turmoil in the markets caused by weak oil prices, analysts note that recent data has been positive and could potentially mark a turnaround point for the U.S. economy after a weak first quarter.
Analysts believed that a delay in the U.S. Federal Reserve's rate hike remains inevitable due to economic instability. Prior to Fed Chairwoman Janet Yellen's address to the U.S. Congress on Feb. 10, the central bank hinted that it could still raise rates in March.
Reference: Kitco, Xinhua
Thai
Eng