Gold price at 8-mo. low as bulls work to stabilize the metal
(Kitco News) - Gold futures prices are modestly lower in early U.S. trading Friday and hit an eight-month low overnight. Silver prices are a bit firmer. The shorter-term, chart-based futures trader bears are mounting a full-on assault of gold, with the bulls just trying to stabilize the market, knowing that the longer-term technical picture remains in their favor. April gold futures were last down $3.10 at $1,771.80 and March Comex silver was last up $0.132 at $27.21 an ounce.
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward firmer openings when the New York day session begins. Global equity markets are ending a mixed week on a quiet note. Overnight, the MSCI Asia Pacific Index was broadly unchanged, while Japan's Topix index closed 0.7% lower. In Europe, the Stoxx 600 Index was up a bit.
Said broker SP Angel in an email dispatch this morning: “Copper and nickel prices continued to rally on Friday, powering to multi-year highs along with tin as the world looks to build its way out of a Covid-fueled recession. Investors are starting to appreciate that there is insufficient mine capacity to enable rapid transition to a more environmentally conscious global economy. As the U.S., China, EU, U.K. and beyond all look to roll out their own packages of environmental initiatives, the post-crisis demand for industrial metals is widely expected to outstrip near-term and medium-term supply.” As these industrial metals rise, it could be that safe-haven gold and silver markets could be pulled along for the ride.
The key “outside markets” today see the U.S. dollar index trading solidly lower. Meantime, Nymex crude oil futures prices are down and trading around $59.50 a barrel. The U.S. wants to talk with Iran on its nuclear ambitions, and that could put more Iranian oil on the world market in the coming months. The U.S. 10-year Treasury note yield is fetching 1.308%. Government bond yields are on the rise, offering a more competitive asset class that may be pulling money away from the stock markets.
U.S. economic data due for release Friday includes the U.S. flash service and manufacturing PMIs, and existing home sales. U.S. economic data is suggesting the world’s largest economy is picking up steam, highlighted by this week’s retail sales report for January showing an unexpected surge.
Technically, the February gold futures bears have the firm overall near-term technical advantage amid a five-week-old price downtrend in place on the daily chart. Bulls’ next upside price objective is to produce a close in February futures above solid resistance at $1,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,750.00. First resistance is seen at Thursday’s high of $1,788.80 and then at Wednesday’s high of $1,794.20. First support is seen at the overnight low of $1,759.00 and then at $1,750.00. Wyckoff's Market Rating: 3.0
March silver futures bulls have the overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at the February high of $30.35 an ounce. The next downside price objective for the bears is closing prices below solid support at $26.00. First resistance is seen at Thursday’s high of $27.595 and then at $28.00. Next support is seen at $27.00 and then at last week’s low of $26.75. Wyckoff's Market Rating: 6.5.