Gold surges to 4.5-month high on safe-haven demand
(Kitco News) - Gold prices are higher in midday U.S. trading Wednesday and pushed to a 4.5-month high. Safe-haven demand was featured in the yellow metal today as the U.S. stock market sold off and risk appetite in the marketplace waned. The gold market bulls stepped in to buy the overnight dip in prices and do some bargain hunting.
June gold futures were last up $14.30 at $1,882.30 and July Comex silver was last down $0.258 at $20.075 an ounce.
Global stock markets were mixed but mostly lower overnight. U.S. stock indexes are lower at midday but up from the daily lows. It was a risk-off trader and investor mentality at mid-week as the marketplace awaited the U.S. data point of the day Wednesday—the afternoon release of the minutes from the last meeting (April 27-28) of the Federal Reserve's Open Market Committee (FOMC). Traders and investors will be looking for further clues on the path of the U.S. economic recovery and on the inflation front.
In other news, Bitcoin continues to crumble at mid-week, falling below $40,000 amid reports of China cracking down on crypto currencies' use for payments and as Elon Musk has made disparaging remarks about cryptos recently. Bitcoin is down around 40% after hitting a high above $65,000 in mid-April. Such reminds of the phrase, "easy come, easy go." The eroding crypto currency market recently has likely given a boost to the precious metals markets and also gives the veteran metals bulls some reassurances that their stores of value that have been used by humankind for thousands of years have not been summarily displaced by computer-software generated crypto currencies that have been in place around a dozen years.
The key outside markets today see the U.S. dollar index higher on a rebound from hitting a nearly three-month low Tuesday. Meantime, Nymex crude oil prices are sharply lower on a corrective pullback after hitting a two-month high Tuesday, and are trading around $63.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently fetching around 1.66%.
Technically, June gold futures prices today hit a 4.5-month high and scored a bullish "outside day" up on the daily bar chart. The gold bulls have the firm overall near-term technical advantage. A seven-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 $1,900.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at last week's low of $1,808.40. First resistance is seen at today's high of $1,891.30 and then at $1,900.00. First support is seen at $1,875.00 and then $1,858.90. Wyckoff's Market Rating: 7.0
July silver futures prices hit a 3.5-month high Tuesday. The silver bulls have the firm overall near-term technical advantage. A seven-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 the February high of $30.015 an ounce. The next downside price objective for the bears is closing prices below solid support at last week's low of $26.78. First resistance is seen at today's high of $28.365 and then at this week's high of $28.90. Next support is seen at today's low of $27.425 and then at $27.00. Wyckoff's Market Rating: 6.5.
July N.Y. copper closed down 1,495 points at 457.60 cents today. Prices closed nearer the session low again today and hit a two-week low. The copper bulls still have the solid overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the May high of 488.80 cents. The next downside price objective for the bears is closing prices below solid technical support at 437.00 cents. First resistance is seen at 460.00 cents and then at 465.00 cents. First support is seen at today's low of 452.85 and then at 450.00 cents. Wyckoff's Market Rating: 7.5.