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Gold price rallies following tamer U.S. inflation data

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(Kitco News) - Gold and silver prices are moderately up in early U.S. trading Friday, and have up-ticked from slightly weaker levels seen just before a key U.S. inflation report came out that was less hot. April gold was last up $6.60 at $1,986.50 and May silver hit a two-month high overnight and was up $0.156 at $24.145.

The U.S. data point of the week this morning saw February personal consumption and expenditures (PCE) data show a PCE price index rise of 5.0%, year-on-year, versus the January reading of up 5.4% annually. The PCE core price index in February was up 4.6%, year-on-year, compared to expectations for a rise of 4.7% and a rise of 4.7% annually in the January report. The consumer spending component of the report showed a rise of 0.2%, month-on-month, in February versus expectations for a rise of 0.3% and a rise of 1.8%, month-on-month, in the January report. It's been said the PCE data are a favorite gauge of inflation for the Federal Reserve.

Global stock markets were mixed to higher overnight. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins. Traders and investors this week gained some better risk appetite as there were no new, negative developments on the U.S. and European banking fronts. However, reads a Wall Street Journal headline today: “Wild quarter for markets might foretell further turbulence.”

Today is the last trading day of the month and of the first quarter, which makes it an extra important trading day from a technical perspective. Gold bulls had their best trading month since July of 2020.

In overnight news, inflation in the Euro zone for March rose 6.9%, year-on-year, versus a rise of 8.5% in February. The March reading was slightly below market expectations.

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The key outside markets today see the U.S. dollar index higher. Nymex crude oil futures prices are slightly higher and trading around $74.75 a barrel. The benchmark 10-year U.S. Treasury note yield is presently fetching 3.564%.

Other U.S. economic data due for release Friday includes the Chicago ISM business survey and the University of Michigan consumer sentiment survey.

Live 24 hours gold chart [Kitco Inc.]

Technically, the gold futures bulls have the firm overall near-term technical advantage. Prices are still in an uptrend on the daily bar chart. A bullish symmetrical triangle pattern has now formed on the daily bar chart. Bulls' next upside price objective is to produce a close in April futures above solid resistance at the March high of $2,014.90. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,900.00. First resistance is seen at $2,000.00 and then at $2,014.90. First support is seen at Thursday's low of $1,954.90 and then at this week's low of $1,945.00. Wyckoff's Market Rating: 7.5

Live 24 hours silver chart [ Kitco Inc. ]

The silver bulls have the solid overall near-term technical advantage as prices hit a two-month high overnight. Prices are in a steep uptrend on the daily bar chart. Silver bulls' next upside price objective is closing May futures prices above solid technical resistance at $25.00. The next downside price objective for the bears is closing prices below solid support at $22.50. First resistance is seen at $24.50 and then at $25.00. Next support is seen at $23.705 and then at Thursday's low of $23.37. Wyckoff's Market Rating: 7.5.

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.