Gold prices see normal corrective pullback amid strong uptrend
(Kitco News) - Gold and silver prices are trading lower in early U.S. trading Thursday, as some normal chart consolidation is occurring following recent strong gains that last week pushed gold prices to a 7.5-year high and silver to a four-week high. Gold and silver bulls still have the near-term technical advantage to continue to suggest the path of least resistance for prices will be sideways to higher. June gold futures were last down $6.70 an ounce at $1,746.20. May Comex silver prices were last down $0.273 at $15.78 an ounce.
Global stock markets were mixed to weaker in overnight trading. U.S. stock indexes are pointed toward lower openings when the New York day session begins. The U.S. stock indexes have seen near-term price uptrends develop, which suggest at least near-term lows are in place. While the Covid-19 pandemic continues to kill thousands worldwide, the rate of the spread of the illness is slowing in the U.S. and Europe. The major debate among North Americans and Europeans is, if the curve of infections continues to flatten when will governments begin to start up their heavily damaged economies. May 1 has been mentioned frequently as a “rolling start” date for the U.S. economy. Still, at present that timeframe seems to be a best-case scenario.
Reports said the U.S. Treasury on Saturday began distributing stimulus funds to American taxpayers.
Over the weekend, the OPEC oil cartel, Russia, the U.S. and other oil-producing nations agreed to a collective oil production cut of around 13%, which amounts to 9.7 million barrels per day. The oil futures markets had pretty much already factored into their prices the cut and were only modestly up Monday. Nymex crude oil prices were trading around $23.00 a barrel.
Other important markets see the U.S. dollar index weaker this morning. The 10-year U.S. Treasury note yield is trading around 0.73% Thursday morning.
There are no major U.S. economic reports out Monday.
Technically, the gold bulls have the strong overall near-term technical advantage amid a price uptrend in place on the daily, weekly and monthly charts. That strongly suggests the path of least resistance for prices will remain sideways to higher for at least the near term and probably longer. Bulls’ next upside price objective is to produce a close in June futures above solid resistance at $1,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,675.00. First resistance is seen at last week’s high of $1,754.50 and then at $1,775.00. First support is seen at the overnight low of $1,724.20 and then at $1,700.00. Wyckoff's Market Rating: 8.5
May silver futures bulls have the overall near-term technical advantage and prices are trending higher on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $17.00 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 $16.00 and then at last week’s high of $16.09. Next support is seen at the overnight low of $15.51 and then at $15.25. Wyckoff's Market Rating: 6.0.