Gold, silver down following upbeat U.S. economic data
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(Kitco News) - Gold and silver prices are solidly lower in midday U.S. trading Thursday, with gold hitting a nine-week low and silver a two-month bottom, in the wake of better-than-expected U.S. economic data that falls into the camp of the U.S. monetary policy hawks. A surging U.S. dollar index and rising U.S. Treasury yields are also bearish outside market elements working against the precious metals. June gold was last down $20.90 at $1,944.10 and July silver was down $0.325 at $22.92.
The second estimate of first-quarter U.S. GDP came in better than expected, at up 1.3% versus expectations of up 1.1% and compares to the first GDP reading of up 1.1%. Also, weekly U.S. jobless claims came in well below market expectations.
Asian and European stock markets were mixed overnight. U.S. stock indexes are mixed to firmer at midday. The Nasdaq is soaring after Nvidia handily beat earnings estimates in its quarterly report and surged 25% in value.
The marketplace is still anxious as U.S. lawmakers and the Biden administration have not come to an agreement to extend the government debt limit. However, House speaker McCarthy today said negotiators are making progress on the matter. Reuters also reported Democrats and Republicans are close to a deal. That likely also added some selling pressure to the safe-haven gold and silver markets. U.S. Treasury Secretary Yellen has said the government could run out of money by June 1.
Reports said the Fitch credit-rating agency put the U.S. on watch for a possible downgrade. "Fitch still expects a resolution to the debt limit before the X-date (1 June)," the credit agency said in a report. Both Fitch and Moody's currently rate the U.S. debt at top AAA and Aaa, respectively, while S&P ranks it at AA+ after a downgrade in 2011 amid debt-ceiling negotiations during that time.
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The key outside markets today see the U.S. dollar index higher and hitting another two-month high overnight. Nymex crude oil prices are solidly lower and trading around $71.50 a barrel. Meantime, the benchmark 10-year U.S. Treasury note yield is presently fetching 3.784%.
Technically, June gold futures prices hit a nine-week low today. Bulls have the overall near-term technical advantage but are fading. Prices are in a three-week-old downtrend on the daily bar chart. Bulls' next upside price objective is to produce a close above solid resistance at $2,000.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,900.00. First resistance is seen at today's high of $1,965.40 and then at this week's high of $1,987.90. First support is seen at today's low of $1,939.20 and then at $1,925.00. Wyckoff's Market Rating: 6.0
July silver futures prices hit a two-month low today. The silver bears have the overall near-term technical advantage. Prices are in a steep three-week-old downtrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $24.50. The next downside price objective for the bears is closing prices below solid support at $22.00. First resistance is seen at today's high of $23.26 and then at Wednesday's high of $23.655. Next support is seen at $22.75 and then at $22.50. Wyckoff's Market Rating: 3.5.
July N.Y. copper closed down 250 points at 358.65 cents today. Prices closed near mid-range today and saw short covering after hitting a six-month low Wednesday. The copper bears have the firm overall near-term technical advantage. Prices are in a steep five-week-old downtrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 380.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 335.00 cents. First resistance is seen at Wednesday's high of 364.55 cents and then at 370.00 cents. First support is seen at this week's low of 354.50 cents and then at 350.00 cents. Wyckoff's Market Rating: 3.0.