Gold sees some normal profit-taking from recent gains
(Kitco News) - Gold prices are moderately down in midday U.S. trading Monday, in a choppy and two-side trading session that is seeing some profit taking from the shorter-term futures traders and some chart consolidation following recent gains. A big drop in crude oil prices today is featured. As raw commodity sector leader crude prices plunge again, gold prices may be seeing a bit of spillover selling pressure. June gold futures were last down $11.70 an ounce at $1,724.00. May Comex silver prices were last up $0.017 at $15.28 an ounce.
A rally global stock markets today and some better trader/investor risk sentiment is also a negative for the safe-haven gold and silver markets. Some regions in some countries, including the U.S., are starting to reopen from the Covid-19-induced lockdown. However, leading U.S. health officials over the weekend said social-distancing restrictions will likely remain in effect all summer.
Highlighted to start the trading week is the big drop in crude oil prices, with Nymex crude trading down well over $4.00 a barrel at $12.25. There is growing talk that Nymex crude prices will again fall into negative territory when the June contract nears expiration in late May. There is no place to store oil amid a glutted world market that has seen such a demand shock. Another U.S. oil producer, Diamond Offshore, filed for bankruptcy over the weekend. Reports that OPEC will begin its previously announced oil-production cuts later this week had no positive impact on prices.
Key central bank meetings occur this week, including those of the Federal Reserve (FOMC) and the European Central Bank. The Bank of Japan further eased its monetary policy on Monday. More key U.S. corporate earnings reports are due out this week.
The other important outside markets today see the U.S. dollar index lower. The 10-year U.S. Treasury note yield is trading around 0.64% today.
Technically, June gold futures bulls still have the solid overall near-term technical advantage. Gold bulls' next upside near-term price objective is to produce a close above solid technical resistance at the April high of $1,788.80. Bears' next near-term downside price objective is pushing prices below solid technical support at last week’s low of $1,666.20. First resistance is seen at today’s high of $1745.80 and then at $1,750.00. First support is seen at today’s low of $1,720.00 and then at $1,707.80. Wyckoff's Market Rating: 7.5
May silver futures bulls have the slight overall near-term technical advantage. However, a four-week-old uptrend on the daily bar chart is still in jeopardy. Silver bulls’ next upside price objective is closing prices above solid technical resistance at the April high of $16.30 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $14.00. First resistance is seen at last week’s high of $15.72 and then at $16.00. Next support is seen at $15.00 and then at $14.75. Wyckoff's Market Rating: 5.5.
May N.Y. copper closed up 110 points at 234.80 cents today. Prices closed near mid-range and hit a six-week high today. The copper bears have the overall near-term technical advantage. Prices are in a five-week-old uptrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 250.00 cents. The next downside price objective for the bears is closing prices below solid technical support at last week’s low of 214.95 cents. First resistance is seen at today’s high of 238.55 cents and then at 240.00 cents. First support is seen at today’s low of 231.65 cents and then at 230.00 cents. Wyckoff's Market Rating: 6.0.