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Gold, silver see more price pressure as U.S. dollar soars

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(Kitco News) - Gold and silver prices are posting more losses in early U.S. trading Wednesday, pressured in part by a very strong U.S. dollar index that overnight hit a 20-year high. Bearish charts are also keeping the technically based bears active on the sell side in the futures markets. Weaker crude oil prices on this day are also working in favor of the metals market bears. June gold futures were last down $11.20 at $1,842.30. July Comex silver futures hit a 22-month low overnight and were last down $0.715 at $20.85 an ounce.

Global stock markets were mostly lower overnight. U.S. stock indexes are pointed toward lower openings when the New York day session begins and hit 12-month lows overnight. Risk aversion remains elevated amid the Russia-Ukraine war that shows no signs of ending, Covid lockdowns in China and problematic price inflation that is gripping the globe. Traders worry the U.S. and other major economies will slip into recession in the coming months, due to the aforementioned factors.

The U.S. gets another inflation reading Thursday with the producer price index for April, which is seen coming in up 0.5% from March and compares to a rise of 1.4% in March from February.

Federal Reserve has hit peak hawkishness and that is good for gold - WisdomTree

In other news, the crypto currencies continue to get hammered amid the keener risk aversion in the marketplace. Bitcoin prices dropped to a 16-month low below $26,000 overnight.

The key outside markets today see Nymex crude oil futures prices lower and trading around $104.00 a barrel. Meantime, the U.S. dollar index is higher in early trading. The yield on the 10-year U.S. Treasury note is fetching 2.837%.

Other U.S. economic data due for release Thursday includes the weekly jobless claims report.

Live 24 hours gold chart [Kitco Inc.]

Technically, the June gold futures bears have the firm overall near-term technical advantage. A two-month-old downtrend line is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close in June futures above solid resistance at $1,900.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,800.00. First resistance is seen at the overnight high of $1,858.80 and then at $1,864.70. First support is seen at this week’s low of $1,830.60 and then at $1,815.00. Wyckoff's Market Rating: 3.5

Live 24 hours silver chart [ Kitco Inc. ]

July silver futures bears have the solid overall near-term technical advantage. Prices hit a 22-month low overnight and are trending sharply down on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $22.50 an ounce. The next downside price objective for the bears is closing prices below solid support at $20.00. First resistance is seen at today’s high of $21.625 and then at $22.00. Next support is seen at today’s low of $20.705 and then at $20.50. Wyckoff's Market Rating: 1.0.

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.