Gold price firmer as bulls work to stabilize market
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(Kitco News) - Gold prices moderately up and silver prices a bit higher in early U.S. trading Monday. Gold hit a four-week low overnight and silver a two-month low. Bulls are now working to just stop the bleeding following a surprisingly strong U.S. jobs report Friday that boosted the U.S. dollar index and Treasury yields while tanking the precious metals. April gold was last up $8.50 at $1,885.00 and March silver was up $0.045 at $22.45.
A feature in the marketplace early this week is a strengthening U.S. dollar index and rising U.S. Treasury yields. This follows last Friday's January U.S. employment situation report from the Labor Department that showed a sharp rise in non-farm payrolls of 517,000. The number was expected to be up only 187,000 jobs, following a rise of 223,000 in the December report. The strong jobs report dashed earlier notions the Federal Reserve might back off on raising interest rates sooner rather than later. A Dow Jones Newswires story this morning is headlined: "Fed cuts look like a dream, not a reality."
The yield on the benchmark U.S. 10-year Treasury note is presently fetching 3.612%. Meantime, Nymex crude oil futures prices are slightly up and trading around $75.50 a barrel.
|Sentiment in gold market continues to cool as prices end the week down 3.5%|
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward lower openings when the New York day session begins, on profit taking after recent strong gains that saw index prices hit multi-month highs last week.
U.S. economic data due for release Monday includes the employment trends index.
Technically, the gold futures bulls still have the overall near-term technical advantage but are fading fast. A three-month-old uptrend on the daily bar chart has been negated. Bulls' next upside price objective is to produce a close in April futures above solid resistance at last week's high of $1,975.20. 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 $1,894.00 and then at $1,900.00. First support is seen at the overnight low of $1,873.20 and then at $1,850.00. Wyckoff's Market Rating: 6.0
The silver bulls have the slight overall near-term technical advantage but have faded badly and need to show fresh power soon. Silver bulls' next upside price objective is closing March futures prices above solid technical resistance at $23.50. The next downside price objective for the bears is closing prices below solid support at $21.00. First resistance is seen at today's high of $22.635 and then at $23.00. Next support is seen at the overnight low of $22.22 and then at $22.00. Wyckoff's Market Rating: 5.5.