Gold prices are weaker in early U.S. trading Friday, losing early modest gains in the immediate aftermath of a U.S. jobs report that beat market expectations. June gold was last down $4.30 at $1,279.20 an ounce. Spot gold was last quoted down $10.00 at $1,281.75. May Comex silver last traded up $0.011 at $19.00 an ounce.

Arguably the most important economic report of the month was just released: the April U.S. employment situation report from the Labor Department. The key non-farm payrolls number came in at up 288,000, which handily beat the consensus forecast of up around 215,000. In March, the non-farm payrolls figure was up 192,000. The U.S. unemployment rate also fell and previous months’ non-farm figures were revised up. This report falls into the bearish camp of gold traders, who reckon the Federal Reserve will continue on its path of tapering its monthly bond purchases.

The Russia-Ukraine crisis was ratcheted up another notch Friday as reports said the Ukraine military is conducting major operation against pro-Russia separatists to regain control of an eastern Ukraine city. Gunfire was reported in the city of Slovyansk. Somewhat surprisingly, the markets are taking this news in stride and without much anxiety. But that could change come Monday morning. Gold is seeing selling interest limited on the heightened Russia-Ukraine tensions.

In other overnight news, the European Union’s unemployment rate was reported at 11.8% in March—the same as in February. Analysts had forecast the rate to come in at 11.9%. Meantime, the Euro zone manufacturing PMI came in at 53.4 in April from 53.0 in March. A reading above 50.0 indicates expansion. However, in another sign that deflationary pressures could be building the EU, manufacturers reported the prices they paid for their inputs dropped in the latest month, and said the prices they charged for their own products fell, too.

Other U.S. economic data due for release Friday includes the ISM New York report on business, and manufacturers’ shipments and orders.

Wyckoff’s Daily Risk Rating: 7.5 (The Russia-Ukraine tensions are still elevated.)

(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 fixing is $1,285.00 versus the previous P.M. fixing of $1,278.50.

Technically, June gold futures bears have the overall near-term technical advantage. A seven-week-old downtrend line is in place on the daily bar chart. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at this week’s high of $1,306.60. Bears' next near-term downside breakout price objective is closing prices below solid technical support at the April low of $1,268.40. First resistance is seen at the overnight high of $1,288.50 and then at Thursday’s high of $1,293.00. First support is seen at the overnight low of $1,272.00 and then at $1,268.40.  

May silver futures bears have the solid overall near-term technical advantage as prices hit an 11-month low Thursday. Prices are in a nine-week-old downtrend on the daily bar chart. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at last week’s high of $19.91 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at the contract low of $18.68. First resistance is seen at the overnight high of $19.17 and then at Wednesday’s high of $19.45. Next support is seen at the overnight low of $18.865 and then at this week’s low of $18.75.

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