Price pressure on gold, silver as Powell on deck
(Kitco News) - Gold and silver prices are lower in early U.S. trading Monday, just ahead of one of the two major U.S. economic data points of the week. April gold was last down $10.20 at $1,844.30 and May silver was down $0.145 at $20.99.
Focus of the marketplace is on Fed Chairman Jerome Powell's testimony on U.S. monetary policy to Senate and House committees on Tuesday and Wednesday. The Tuesday Senate testimony begins at 10:00 a.m. EST. The Wall Street Journal reports Powell "is likely to caution on Capitol Hill that strong economic activity this year could lead central bank officials to raise interest rates more than they expected, to combat high inflation."
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins.
Traders and investors are also looking forward to the February U.S. employment situation report from the Labor Department on Friday morning. The key non-farm payrolls component of the report is expected to show a rise of 225,000 jobs, following a mammoth rise of 517,000 in the January report.
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The key outside markets see the U.S. dollar index slightly firmer. Nymex crude oil futures prices are slightly down and trading around $80.00 a barrel. The yield on the benchmark U.S. 10-year Treasury note is presently fetching 3.928%--down a bit after pushing above 4.0% last week.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and chain store retail sales indexes, the IDB/TIPP economic optimism index, monthly wholesale trade and consumer credit.
Technically, the gold futures bulls have the slight overall near-term technical advantage. A downtrend 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 $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 $1,856.90 and then at last week's high of $1,864.40. First support is seen at $1,842.00 and then at $1,835.00. Wyckoff's Market Rating: 5.5
The silver bears have the overall near-term technical advantage. Prices are in a steep five-week-old downtrend on the daily bar chart. Silver bulls' next upside price objective is closing May futures prices above solid technical resistance at $22.25. The next downside price objective for the bears is closing prices below solid support at $19.00. First resistance is seen at this week's high of $21.395 and then at $21.75. Next support is seen at $20.76 and then at the February low of $20.505. Wyckoff's Market Rating: 4.0.