Price gains for gold, silver on short covering, value buying
(Kitco News) - Gold and silver prices are moderately higher in early U.S. trading Monday, on some short covering by the shorter-term futures traders and some perceived value buying buy traders in the cash market. April gold futures were last up $8.90 at $1,728.80 and May Comex silver was last up $0.254 at $26.165 an ounce.
Global stock markets were mixed but mostly firmer overnight. U.S. stock indexes are pointed toward modestly higher openings when the New York day session begins. Investors and traders to start the trading week are more focused on better global economic growth prospects and the pandemic being tamped down by rising vaccination levels, and less focused on rising government bond yields that have at times recently produced speed bumps for the stock market bulls. The benchmark 10-year U.S. Treasury note yield is presently fetching 1.613%.
U.S. Treasury Secretary Janet Yellen said Sunday the U.S. inflation risk is small and manageable. The Federal Reserve's two-day Open Market Committee (FOMC) meeting begins Tuesday morning and ends Wednesday afternoon with a statement and new U.S. economic projections. While no change in U.S. monetary policy is expected at this week's meeting, traders will be closely scrutinizing wording on the Fed's economic growth and inflation prospects.
In overnight news, China's retail sales in January and February were up 34% from the same period last year. Industrial output was up 35% in the period. The data from China's National Bureau of Statistics underscores notions the world's second-largest economy is roaring full speed ahead.
The key "outside markets" today see Nymex crude oil futures prices firmer and trading around $65.88 a barrel. Meantime, the U.S. dollar index is a bit higher early today.
U.S. economic data due for release Monday is light and includes the Empire State manufacturing survey and Treasury international capital data. The pace of U.S. data really picks up Tuesday, including the FOMC meeting.
Technically, the April gold futures bears have the firm overall near-term technical advantage amid a nine-week-old price downtrend in place on the daily chart. Bulls' next upside price objective is to produce a close in April futures above solid resistance at $1,750.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the March low of $1,673.30. First resistance is seen at the overnight high of $1,732.60 and then at last week's high of $1,738.00. First support is seen at the overnight low of $1,719.20 and then at $1,700.00. Wyckoff's Market Rating: 2.5
May silver futures bears have the slight overall near-term technical advantage. Prices are in a six-week-old downtrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $27.50 an ounce. The next downside price objective for the bears is closing prices below solid support at the March low of $24.845. First resistance is seen at the overnight high of $26.27 and then at last week's high of $26.545. Next support is seen at today's low of $25.845 and then at Friday's low of $25.425. Wyckoff's Market Rating: 4.5.