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Gold recovers early losses as bulls step in to buy the dip

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(Kitco News) - Gold prices are modestly up in midday U.S. trading Thursday as bullish traders stepped in to do some bargain hunting when prices were moderately lower in the early going. The U.S. dollar index lost its overnight highs and that also aided the gold market bulls. Silver is a bit weaker today on some mild profit taking, but both metals remain in price uptrends on the daily charts, to suggest the path of least resistance for prices will remain sideways to higher in the near term. June gold futures were last up $2.60 at $1,825.60 and July Comex silver was last down $0.104 at $27.14 an ounce.

Today's U.S. producer price index report for April came in at up 0.6% from March, which was double the 0.3% rise that was forecast. The April CPI was up over 6%, year-on-year. The PPI report followed a hot consumer price index report issued on Wednesday. Evidence continues to build that the U.S. economy and even other major global economies are going to have to battle unwanted inflationary pressures at some point down the road. That's very likely going to be ultimately bullish for the metals markets, which are hard assets that history shows tend to appreciate during times of problematic inflation.

Global stock markets were solidly lower overnight. U.S. stock indexes are higher in midday trading on a rebound from big losses Wednesday. The equities bulls are still on the ropes late this week following this week's strong selling pressure that negated near-term price uptrends on the daily bar charts for the U.S. stock indexes, which is a technical clue the indexes have put in price tops. Traders and investors are pondering the old trading adage, "Sell in May and go away."

The marketplace is still keeping an eye on the worsening flare-up in the Middle East, as Israel and Hamas have ratcheted up their missile strikes against each other. The military action between the two is the most intense since 2014.

The key outside markets today see the U.S. dollar index slightly up at midday. Meantime, Nymex crude oil prices are sharply lower and trading around $63.25 a barrel. The U.S. Colonial pipeline system that had been shut down due to a cyberattack has reopened. The yield on the benchmark 10-year U.S. Treasury note is on the rise late this week and is presently fetching around 1.65%.

Live 24 hours gold chart [Kitco Inc.]

Technically, June gold futures bulls have the overall near-term technical advantage. A six-week-old price uptrend is in place on the daily bar chart. Bulls' next upside price objective is to produce a close above solid resistance at $1,850.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,775.00. First resistance is seen at $1,836.00 and then at this week's high of $1,846.30. First support is seen at today's low of $1,808.40 and then at $1,800.00. Wyckoff's Market Rating: 6.5

Live 24 hours silver chart [ Kitco Inc. ]

July silver futures bulls have the overall near-term technical advantage. A six-week-old uptrend is in place on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $28.475 an ounce. The next downside price objective for the bears is closing prices below solid support at $25.745. First resistance is seen at today's high of $27.33 and then at $27.50. Next support is seen at today's low of $26.78 and then at $26.50. Wyckoff's Market Rating: 6.5.

July N.Y. copper closed down 465 points at 469.00 cents today. Prices closed near mid-range today and saw profit taking. Prices Monday hit a contract and nearly 10-year high. The copper bulls still have the strong overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 500.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 442.00 cents. First resistance is seen at Wednesday's high of 482.45 cents and then at the contract high of 488.80 cents. First support is seen at today's low of 464.35 and then at 460.00 cents. Wyckoff's Market Rating: 8.5.

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.