Gold, silver bulls work to stabilize their markets
(Kitco News) - Gold prices are modestly up and silver prices a bit weaker in midday U.S. trading Monday. Gold hit a four-week low overnight and silver a two-month low. Bulls are now working to stop the bleeding following a surprisingly strong U.S. jobs report Friday that tanked the precious metals markets. April gold was last up $3.00 at $1,879.40 and March silver was down $0.135 at $22.265.
A feature in the marketplace early this week is a strengthening U.S. dollar index and rising U.S. Treasury yields—both bearish elements for the precious metals markets. 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."
Fed Chairman Jerome Powell is set to speak at an economics club in Washington, D.C. on Tuesday and his remarks will be very closely scrutinized.
|Gold has no reason to fear the Fed, so investors shouldn't be betting against it - SSGA's George Milling-Stanley|
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.
Global stock markets were mixed overnight. U.S. stock indexes are lower at midday on profit taking after recent strong gains that saw index prices hit multi-month highs last week.
Technically, April gold futures prices hit a four-week low overnight and the bull are fading. Bulls still have the overall near-term technical advantage. However, a three-month-old uptrend on the daily bar chart has been negated, to suggest a near-term market top is in place. Bulls' next upside price objective is to produce a close above solid resistance at the February 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 today's high of $1,894.00 and then at $1,900.00. First support is seen at today's low of $1,873.20 and then at $1,850.00. Wyckoff's Market Rating: 6.0
March silver futures prices hit a two-month low today. The silver bulls have the slight overall near-term technical advantage but are fading fast. Prices have seen a bearish downside "breakout" from a sideways trading range at higher levels. Silver bulls' next upside price objective is closing prices above solid technical resistance at $24.00. 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 today's low of $22.22 and then at $22.00. Wyckoff's Market Rating: 5.5.
March N.Y. copper closed down 275 points at 402.90 cents today. Prices closed near mid-range and hit a three-week low today. The copper bulls have the overall near-term technical advantage but are fading. A four-month-old uptrend on the daily bar chart has been at least temporarily negated. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the January high of 435.50 cents. The next downside price objective for the bears is closing prices below solid technical support at 380.00 cents. First resistance is seen at 410.00 cents and then at 420.00 cents. First support is seen at today's low of 399.30 cents and then at 390.00 cents. Wyckoff's Market Rating: 6.5.