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Price pressure on gold, silver as bond yields on the rise

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(Kitco News) - Gold and silver prices are solidly lower in early U.S. trading Wednesday, on some profit taking from the shorter-term futures traders after recent gains, and as U.S. Treasury bond yields are on the rise again. A firmer U.S. dollar index at mid-week is also an bearish element for metals markets today. June gold futures were last down $14.40 at $1,764.70 and July Comex silver was last down $0.52 at $25.93 an ounce.

Global stock markets were mixed to mostly firmer overnight. U.S. stock indexes are pointed toward mixed openings when the New York day session begins. It’s a big day for markets Wednesday. The data point of the week is the conclusion of the Federal Reserve’s Open Market Committee (FOMC) meeting that began Tuesday morning and ends Wednesday afternoon with a statement and press conference from Fed Chair Powell. While no change in U.S. monetary policy is expected, the marketplace will closely scrutinize the Fed’s inflation outlook and any comments on the future path of monetary policy. Also, President Biden today is set to lay out to a joint session of Congress another big government spending program in order to continue to pry the U.S. economy away from the grip of the pandemic. Biden’s $1.8 trillion "American Families Plan" includes $1 trillion in spending and $800 million in tax cuts and credits for middle- and lower-income American families. The 10-year plan would be part funded by increased taxes and wealthy Americans.

The key outside markets today see the U.S. dollar index firmer. Nymex crude oil prices are higher and trading around $63.15 a barrel. Meantime, the yield on the benchmark 10-year U.S. Treasury note is presently fetching around 1.64%. Bond yields are on the rise again at mid-week.  

Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the advance economic indicators report and the weekly DOE liquid energy stocks report.

Live 24 hours gold chart [Kitco Inc.]

Technically, June gold futures bulls have the overall near-term technical advantage. However, they need to show fresh power soon to keep alive a price uptrend in place 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 $1,723.20. First resistance is seen at the overnight high of $1,776.80 and then at this week’s high of $1,785.90. First support is seen at $1,760.00 and then at 1,750.00. Wyckoff's Market Rating: 6.0

Live 24 hours silver chart [ Kitco Inc. ]

The silver bulls have the overall near-term technical advantage. A four-week-old price uptrend is in place on the daily bar chart. Silver bulls' next upside price objective is closing July futures prices above solid technical resistance at $27.00 an ounce. The next downside price objective for the bears is closing prices below solid support at $25.00. First resistance is seen at the overnight high of $26.38 and then at this week’s high of $26.56. Next support is seen at last week’s low of $25.715 and then at $25.50. Wyckoff's Market Rating: 6.0.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.