Solid price rebounds for gold, silver as oil bounces, USDX weaker
(Kitco News) - Gold and silver prices are sharply up in early U.S. trading Thursday, helped by bullish outside markets that include good gains in crude oil and a weaker U.S. dollar index on this day. Safe-haven demand and perceived bargain hunting are also featured in the precious metals late this week.April gold futures were last up $28.80 at $1,938.40 and May Comex silver was last up $0.73 at $25.435 an ounce.
Global stocks markets were mixed overnight. Asian equity markets rallied for a second day after the Chinese government said it would work to keep its stock and financial markets buoyant. The U.S. stock indexes are pointed toward weaker openings when the New York day session begins, following very strong gains Wednesday. Risk aversion has receded just a bit this week, on trader and investor hopes that Russia and Ukraine may be making some progress in their peace talks. However, Russian shelling and killing of civilians in Ukraine continues, as U.S. President Biden labeled Russian President Putin a war criminal. Don't be surprised to see risk aversion in the marketplace become much keener in the near term, as it presently appears "hope" on the peace talks is trumping "reality." The gold market is suggesting such, as the safe-haven metal trades sharply higher Thursday.
Traders are still digesting the Federal Reserve's FOMC meeting that ended Wednesday afternoon with a statement and press conference from Fed Chairman Powell. The Fed, as expected, raised its Fed funds rate by 0.25%--the first rate hike since 2018. The FOMC signaled it may raise rates six more times this year and a few times next year, in an effort to tamp down problematic inflation. After the FOMC statement and Powell's press conference, the marketplace deemed the Fed as being a bit more hawkish on fighting inflation than expected.
|Gold price down but not out as Federal Reserve starts tightening cycle and lowers 2022 growth forecast and raises inflation expectations|
In overnight news, the Euro zone February consumer price index rose by 5.9%, year-on-year, which is a record high for the bloc.
The key outside markets see Nymex crude oil prices solidly higher and trading around $99.50 a barrel. The U.S. dollar index is lower again today. The benchmark U.S. 10-year Treasury note is presently yielding 2.123%.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the Philadelphia Fed business survey, new residential construction, and industrial production and capacity utilization.
Technically, the April gold futures bulls have the overall near-term technical advantage. However, recent solid losses suggest a market top is in place. Bulls' next upside price objective is to produce a close in April futures above major resistance at $2,000.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,850.00. First resistance is seen at the overnight high of $1,948.00 and then at $1,956.90. First support is seen at the overnight low of $1,924.00 and then at $1,908.10. Wyckoff's Market Rating: 6.0
May silver futures bulls have the overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at $26.50 an ounce. The next downside price objective for the bears is closing prices below solid support at $24.00. First resistance is seen at the overnight high of $25.64 and then at $26.00. Next support is seen at the overnight low of $25.165 and then at $25.00. Wyckoff's Market Rating: 6.5.