Gold, Silver Bulls Work To Stabilize Prices Amid Downtrends
(Kitco News) - Gold and silver prices are steady to slightly lower in early-afternoon U.S. trading Wednesday. Some short covering in the futures market and some perceived bargain buying in the cash have limited the selling interest in both markets today. However, the gold and silver bulls are still in technical trouble amid price downtrends in place on the daily bar charts. Gold prices dropped to a nearly four-month low again today. June gold futures were last down $1.40 an ounce at $1,275.80. May Comex silver was last up $0.005 at $14.92 an ounce.
Asian and European stock indexes were mostly higher overnight. U.S. stock indexes are mixed at midday today and near this week’s six-month highs. The U.S. indexes are closing in on their record highs scored last fall.
China’s gross domestic product report came out Wednesday and showed slightly better-than-expected growth of 6.4% in the first quarter, year-on-year. Stronger industrial production and retail sales were cited as boosting GDP. Most were expecting upbeat numbers just north of 6% annual GDP growth for the world’s second-largest economy. This report was a bit friendly for the metals markets, as it implies better demand for raw commodities coming from the world’s largest raw commodity importer.
An important change in market psychology has occurred just the past few weeks. Government bond yields in the world’s major economies are on the rise, after seeing their yields decline the first two months of the year. This is due in part to little risk aversion in the marketplace that is seeing monies flow into stock markets, which in turn prompts bond yields to rise in order to attract investor buying interest.
The key outside markets today find the U.S. dollar index near steady. Meantime, Nymex crude oil prices are also near steady and trading around $64.00 a barrel.
Technically, June gold futures prices closed near the session low today. The bears have the overall near-term technical advantage. A two-month-old downtrend line on the daily bar chart is in place. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,300.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,250.00. First resistance is seen at today’s high of $1,282.10 and then at Tuesday’s high of $1,291.70. First support is seen at $1,270.00 and then at $1,260.00. Wyckoff's Market Rating: 4.0.
May silver futures prices closed nearer the session low. Prices Monday hit a 3.5-month low. The silver bears have the overall near-term technical advantage. A two-month-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 the April high of $15.31 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $14.50. First resistance is seen at today’s high of $15.055 and then at $15.25. Next support is seen at this week’s low of $14.795 and then at $14.75. Wyckoff's Market Rating: 4.0.
May N.Y. copper closed up 325 points at 296.30 cents today. Prices closed near mid-range today and hit a 9.5-month high early on. The copper bulls have the firm overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 300.00 cents. The next downside price objective for the bears is closing prices below solid technical support at the March low of 283.45 cents. First resistance is seen at today’s high of 299.55 cents and then at 300.00 cents. First support is seen at this week’s low of 291.65 cents and then at 290.00 cents. Wyckoff's Market Rating: 6.5.