Gold prices are lower and hit a six-week low in early U.S. trading Friday, giving up modest gains seen in overnight dealings. There have been no major developments late this week to drive the gold market, and the technical traders are dominating price action. The charts are favoring the gold and silver bears at present. April gold was last down $6.50 at $1,288.50 an ounce. Spot gold was last quoted down $2.70 at $1,289.50. May Comex silver last traded down $0.018 at $19.69 an ounce.

In overnight news, the European Union remains worried about deflationary price pressures as Spain has slipped into deflation, reports said. Some German and French inflation figures released Friday also showed a slowing pace of price increases. This news favors the camp of European Union monetary policy doves who want to see soon fresh monetary stimulus from the European Central Bank.

The market place has taken note of the Chinese premiere Li Keqiang’s comments to the official China newspaper Friday. Li said China’s economic growth needs to be kept at a “reasonable pace.” Some are taking that to mean China could soon introduce new monetary policy stimulus measures to boost its economy.

U.S. economic data due out Friday includes personal income and outlays, and the University of Michigan consumer sentiment survey. The market place is already looking ahead to next Friday’s U.S. jobs report.

Wyckoff’s Daily Risk Rating: 6.0 (The Ukraine situation has for the moment de-escalated but is still an unsettling market factor.)

(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 $1,295.75 versus the P.M. fixing of $1,296.00.

Technically, gold bears have the overall near-term technical advantage and still have momentum on their side. Bulls’ next upside near-term price breakout objective is to produce a close above technical resistance at this week’s high of $1,335.70. Bears' next near-term downside breakout price objective is closing prices below technical support at $1,250.00. First resistance is seen at $1,300.00 and then at Thursday’s high of $1,307.60. First support is seen at $1,280.00 and then at $1,275.00.  

May silver futures bears have the firm near-term technical advantage as prices hit a seven-week low Thursday. A five-week-old downtrend is in place on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at $20.63 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $19.00. First resistance is seen at the overnight high of $19.92 and then at $20.00. Next support is seen at this week’s low of $19.575 and then at $19.50.

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