Gold posts decent rebound after last week's pounding
(Kitco News) - Gold prices are solidly up in midday U.S. trading Monday on a corrective and short-covering rebound after dropping sharply last week and hitting a five-week low on Friday. Silver prices are modestly up after hitting a nine-week low early on today. August gold futures were last up $14.00 at $1,783.00 and July Comex silver was last up $0.051 at $26.02 an ounce.
The key outside markets are bullish for the metals today, as the U.S. dollar index is lower on a corrective pullback after solid gains posted last week. Nymex crude oil futures are a solidly higher, trading around 72.79 a barrel and hit a 2.5-year high today.
The marketplace continues to buzz about inflation prospects after last week’s hawkish monetary policy tone from the Federal Reserve. However, with many economic indicators pointing to the stronger potential for higher inflation creating problems, one major indicator does not: U.S. Treasury yields. The yield on the benchmark U.S. 10-year Treasury note is fetching 1.43% Monday morning. That’s lower than the yield on the 10-year note that was seen prior to last Wednesday’s FOMC meeting results. U.S. T-Note yields have fallen for five straight weeks. The marketplace will closely scrutinize Federal Reserve Chairman Jerome Powell’s remarks to a House committee Tuesday afternoon.
Global stock markets were mixed overnight, with Asian shares mostly lower and European shares mostly higher. The U.S. stock indexes are higher at midday, after suffering a rough week last week. Today is one of those trading days where gold and silver are posting gains at the same time the competing asset class of equities sees the stock indexes also higher.
Technically, August gold futures prices hit a five-week low Friday. The gold bears still have the overall near-term technical advantage. A three-week-old price downtrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,826.40. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,700.00. First resistance is seen at $1,800.00 and then at $1,815.00. First support is seen at last week’s low of $1,761.20 and then at $1,750.00. Wyckoff's Market Rating: 4.0
July silver futures prices hit a nine-week low early on today. The silver bears have the overall near-term technical advantage. A four-week-old price downtrend is in place on the daily bar chart. Silver bulls' next upside price objective is closing 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 $26.555 and then at $27.00. Next support is seen at today’s low of $25.58 and then at $25.00. Wyckoff's Market Rating: 4.0.
July N.Y. copper closed up 305 points at 418.75 cents today. Prices closed near the session high and hit a nine-week low today. Short covering was featured. The copper bulls and bears are on a level overall near-term technical playing field. A five-week-old downtrend is in place on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 450.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 400.00 cents. First resistance is seen at 425.00 cents and then at 433.95 cents. First support is seen at today’s low of 408.80 cents and then at 405.00 cents. Wyckoff's Market Rating: 5.0.