Gold bulls still technically weak, working to stabilize market
(Kitco News) - Gold futures prices are near steady in midday U.S. trading Thursday after hitting an eight-month low early on today. The bulls are near-term technically wounded and are just trying to stabilize a market in a downslide. Silver prices are down today but that metal has not been hit as hard as gold recently. April gold futures were last up $0.30 at $1,773.00 and March Comex silver was last down $0.25 at $27.06 an ounce.
Global stock markets were mixed but mostly weaker overnight. Mainland China markets were open Thursday after being closed several days for the Lunar New Year holiday. U.S. stock indexes are lower at midday on profit taking from recent gains. There is still scant risk aversion in the marketplace at present and that’s bullish for equities but bearish for the safe-haven metals.
Rising government bond yields are a focus of the marketplace this week and that competing asset does have the stock market bulls a bit worried. The U.S. Treasury 10-year note reached its highest yield in a year earlier this week and is currently fetching 1.282%. If U.S. Treasury yields continue to rise, investors would be more inclined lock in those higher returns. For perspective, the German 10-year bond (bund) yield stands at -0.359% and the U.K. bond (gilt) yield is 0.585%.
Copper futures prices hit a nine-year high Thursday, as the red industrial metal is surging on ideas of strong demand in the coming months as major economies shift into high gear with the pandemic likely tamped down.
The key “outside markets” today see the U.S. dollar index trading lower. Meantime, Nymex crude oil futures prices are weaker and trading around $60.70 a barrel. Bloomberg today reported, “With millions of Texans in the dark for a fourth day after the unusually cold weather caused widespread blackouts, the fallout for energy markets is becoming a worldwide problem. Almost 40% of U.S. crude production is now offline, helping push the global benchmark Brent price above $65 a barrel in Asia trading. While temperatures are forecast to rise this weekend, it could take weeks for production to be fully restored as operators need to assess wells for damage.”
Technically, April gold futures prices also hit another eight-month low early on today. The gold bears have the firm overall near-term technical advantage. Prices are in a six-week-old downtrend on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,750.00. First resistance is seen at today’s high of $1,788.80 and then at Wednesday’s high of $1,794.20. First support is seen at today’s low of $1,766.60 and then at $1,760.00. Wyckoff's Market Rating: 3.0
March silver futures bulls have the overall near-term technical advantage amid a price uptrend in place on the daily chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the February high of $30.25 an ounce. The next downside price objective for the bears is closing prices below solid support at $26.00. First resistance is seen at today’s high of $27.595 and then at this week’s high of $28.075. Next support is seen at last week’s low of $26.75 and then at $26.50. Wyckoff's Market Rating: 6.5.
March N.Y. copper closed down 835 points at 390.40 cents today. Prices closed near the session high and hit a contract and nine-year high today. The copper bulls have the strong overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 400.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 373.40 cents. First resistance is seen at today’s contract high of 393.10 cents and then at 395.00 cents. First support is seen at 385.00 cents and then at today’s low of 381.90 cents. Wyckoff's Market Rating: 9.5.