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Gold price up as U.S. consumer inflation runs hot

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(Kitco News) - Gold and silver prices are posting good gains in early U.S. action Tuesday, in the wake of another U.S. inflation report that ran hot and is being deemed problematic. June gold futures were last up $24.50 at $1,972.60 and May Comex silver was last up $0.513 at $25.495 an ounce.

The just-released U.S. data point of the week saw the consumer price index for March come in at up 8.5%, year-on-year, which is a 40-year high. March CPI was expected to come in at up 8.4%, annually. On Wednesday comes the U.S. producer price index report for March.

Global stocks markets were mixed overnight. The U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins. On the Russia invasion of Ukraine front, the U.S. has now warned the war will take a more protracted and bloodier turn. Reports said European countries are now focusing more on arming the Ukrainians and less on adding economic sanctions on Russia.

The Covid pandemic continues to surge in China, the world's second-largest economy. Broker SP Angel said today in an email dispatch: "Strict Shanghai lockdown has put other Chinese cities on edge. All residents in Shanghai have been in a strict lockdown since last Tuesday as Covid cases surge and the government doubles down on its 'zero covid' strategy. Residents have been left without food or medicine, leading to protests and general unrest. Shanghai is the most populous city in China and thought to contribute 3.5% of the country's total GDP. It is thought that now over 70 of China's largest 100 cities are suffering some sort of lockdown. Panic buying is sweeping through cities, with officials in the southern port city of Guangzhou urging residents to stop excess purchasing as a local paper suggested shortages were imminent."

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Nymex crude oil futures prices are solidly higher today and trading around $98.00 a barrel. The U.S. dollar index is firmer early today and hit another two-year high overnight. The yield on the 10-year U.S. Treasury note is presently fetching 2.792% and at a more-than-three-year high.

Other U.S. economic data due for release Tuesday includes the NFIB small business index, real earnings, the Johnson Redbook and chain store weekly reports, the IBD/TIPP economic optimism index, and the monthly Treasury budget statement.

Live 24 hours gold chart [Kitco Inc.]

Technically, the June gold futures bulls have the overall near-term technical advantage. 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 the March low of $1,893.20. First resistance is seen at $1,975.00 and then at $2,000.00. First support is seen at $1,950.00 and then at this week's low of $1,942.90. Wyckoff's Market Rating: 6.5

Live 24 hours silver chart [ Kitco Inc. ]

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 $26.16 an ounce. The next downside price objective for the bears is closing prices below solid support at the March low of $24.045. First resistance is seen at this week's high of $25.60 and then at $26.00. Next support is seen at $25.00 and then at this week's low of $24.795. Wyckoff's Market Rating: 6.5.

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.