Gold and silver were steady overnight, but the main trend is still down. A strong economy, strong stock market, and strong dollar provide little reason to own precious metals. Gold fell to a 4-month low on Tuesday after new evidence of a strong US economy emerged to push US equity markets higher.
US New Home Sales for March were up 4.5 percent to their highest level since November 2017. It was their third straight monthly increase. Strong earnings from Coca-Cola, Twitter and United Technologies sent the nearby NASDAQ and S&P 500 to all-time highs.
The June dollar index traded to a new high for the move. While the average expectation for Fridays' 1st Quarter GDP reading is calling for a gain of 2.1%, there is some talk that it could be in the range of 2.2% to 3.4% higher based on recent Atlanta Fed data.
This sentiment is bearish for gold, but it could also be building the gold market up for a bullish surprise on Friday.
Gold miner Centamin reported 1st quarter output at 116,183 ounces versus a target of 105,000-115,000.
After falling below the 50 and 100-day moving averages last week, June gold came close to testing the 200-day average at $1,267 on Tuesday.
Recent positioning reports showed funds have recently crossed over to a net short position, and this selling trend is negative. Shares in the world's largest gold ETF have fallen to their lowest levels since Oct 23rd.
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