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Gold Rebounds On Bargain Hunting Following Recent Pressure

[DEH1]

Gold Rebounds On Bargain Hunting Following Recent Pressure

Thursday May 05, 2016 08:31

(Kitco News) - Gold prices are higher in early U.S. trading Thursday, on a “buy the dip” bounce following the recent profit-taking selling pressure. Gold bulls are encouraged today as their precious metal is higher even as the U.S. dollar index also trades higher. June Comex gold futures were last up $7.80 an ounce at $1,282.40. July Comex silver was last up $0.249 at $17.545 an ounce.

Global stock markets were mostly higher Thursday, as crude oil prices rebounded smartly from losses seen earlier this week. Japan’s markets remained closed for a public holiday. U.S. stock indexes are pointed toward higher openings when the day session begins in New York.

The key “outside markets” on Thursday find the U.S. dollar index again higher on more short covering and bargain hunting after prices hit an eight-month low on Tuesday. If the greenback can post a weekly high close on Friday that would be an early clue that the dollar index has put in a near-term bottom. The rebound in the dollar index has put some selling pressure into raw commodity markets. Meantime, Nymex crude oil prices are solidly higher in early U.S. trading Thursday and hovering just above $45.00 a barrel. As goes crude oil, so, too, will likely go the raw commodity sector.

Traders and investors are looking ahead to Friday’s U.S. jobs report for April from the Labor Department—arguably the most important U.S. economic report of the month. The key non-farm payrolls number is expected to show a rise of 205,000 in April. However, Wednesday’s weak ADP jobs number (up 156,000) calls into question whether the Friday jobs number can meet expectations.

U.S. economic data due for release Thursday includes the weekly jobless claims report, the Challenger job cuts report, and monthly chain store sales results.

 (Note: Follow me on Twitter--@jimwyckoff--for breaking market news.)

Wyckoff’s Daily Risk Rating: 2.5 (Trader and investor market risk aversion is not elevated today.)

(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 5, with 1 being least risk-averse (most risk-on) and 5 being the most risk-averse (risk-off).

Technically, June gold futures bulls still have the firm overall near-term technical advantage. Bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at this week’s high of $1,306.00. Bears' next near-term downside price breakout objective is closing prices below solid technical support at $1,250.00. First resistance is seen at Thursday’s high of $1,281.80 and then at $1,300.00. First support is seen at Wednesday’s low of 1,273.60 and then at $1,264.70. Wyckoff’s Market Rating: 7.5

[intowin]

Golds trend lately is to get beating down in the morning trading only to recover some what later in the day. It appears the same is happening today. We need the reverse to happen.