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Gold solidly down amid bearish outside markets: USDX up, oil down

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(Kitco News) - Gold prices are trading sharply lower in midday U.S. dealings Wednesday. The precious metal appears to be feeling the negative pressure of bearish outside market forces today that include lower crude oil prices and a higher U.S. dollar index. The U.S. stock market also lost its early gains, which may have also weighed on gold. Recently, the gold market has traded in tandem with the U.S. stock indexes on some days. June gold futures were last down $22.30 an ounce at $1,688.20. July Comex silver prices were last down $0.045 at $15.065 an ounce.

Today’s U.S. ADP national employment report for April came in at down at 20.236 million—a sobering reminder of the state of the U.S. and global economy at present, amid the Covid-19 pandemic. The marketplace expected an ADP figure of down around 22 million. The ADP report is a precursor to Friday morning’s more important employment situation report from the U.S. Labor Department. U.S. stock indexes lost altitude after the report.

Global stock markets were mixed to firmer in overnight trading. Traders and investors are showing a bit more risk appetite at mid-week, as Nymex crude oil futures prices have rebounded sharply from single-digit levels seen in late April. Also, U.S.-China tensions have ratcheted down just a bit as both sides have toned down their harsh rhetoric—at least for the moment. Still, the Covid-19 pandemic lingers to keep the marketplace generally uneasy. While parts of North America and Europe reopen for business, the numbers of Covid-19 cases and deaths in the U.S. continue to rise at an alarming rate.

In overnight news, the Euro zone retail sales in March were reported down 11.2% from February and down 9.2%, year-on-year. Those numbers were records for declines. Also, the Euro zone services purchasing managers index (PMI) was reported at 12.0 for April. A reading below 50.0 suggests contraction in the sector.

The important outside markets see Nymex crude oil prices lower and trading around $23.25 a barrel in June futures. Prices have more than doubled from the recent low. The U.S. dollar index is higher again today and the greenback bulls are having a good week. The Euro currency is pressured this week as the European Central Bank’s authority to stimulate the Euro zone economy has been called into question by Germany. 

Live 24 hours gold chart [Kitco Inc.]

Technically, June gold futures bulls still have the overall near-term technical advantage amid a seven-week-old price uptrend still in place on the daily bar chart, but now just barely. Bulls need to show fresh power soon to keep the price uptrend alive. Gold bulls' next upside near-term price objective is to produce a close above solid technical resistance at $1,740.00. Bears' next near-term downside price objective is pushing prices below solid technical support at $1,666.20. First resistance is seen at $1,700.00 and then at today’s high of $1716.60. First support is seen at today’s low of $1,683.00 and then at last week’s low of 1,676.00. Wyckoff's Market Rating: 6.5

Live 24 hours silver chart [ Kitco Inc. ]

July silver futures bulls and bears are on a level overall near-term technical playing field. Trading has been sideways-lower recently. 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 today’s high of $15.39 and then at $15.50. Next support is seen at this week’s low of $14.76 and then at $14.56. Wyckoff's Market Rating: 5.0.

July N.Y. copper closed up 155 points at 234.80 cents today. Prices closed nearer the session high today. The copper bulls have the slight overall near-term technical advantage. Prices are in a six-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 221.70 cents. First resistance is seen at today’s high of 236.55 cents and then at the April high of 239.50 cents. First support is seen at 230.00 cents and then at this week’s low of 228.40 cents. Wyckoff's Market Rating: 5.5.

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