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Gold price rebounds on short covering, bargain buying

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(Kitco News) - Gold and silver prices are firmer in early U.S. trading Friday, on bargain hunting and short covering after gold hit a nine-week low and silver a two-month bottom overnight. A weaker U.S. dollar index and a dip in U.S. Treasury yields on this day are mildly aiding the metals market bulls. June gold was last up $8.70 at $1,952.40 and July silver was up $0.39 at $23.30.

Asian and European stock markets were mixed overnight. U.S. stock indexes are pointed toward slightly higher when the New York day session begins. Trader and investor attitudes are a bit more upbeat to end the trading week, on reports that U.S. lawmakers are moving closer to a deal to raise the U.S. government’s debt limit. The Wall Street Journal reported Republican and Democrat leaders are narrowing their differences and are zeroing in on a two-year spending deal that would raise the debt limit for two years. Lawmakers are hoping to see a deal pass through Congress next week.

A feature in the marketplace Thursday was the big rally in Nvidia stock following its strong earnings report. Some stock analysts and fund managers are saying the Nvidia stock rally is a wake- up call: artificial intelligence (AI) will have a bigger impact on global society than the advent of the internet nearly 30 years ago.

The U.S. data point of the day is the personal income and outlays report for April, including the important personal consumption expenditures (PCE) price indexes. Personal income is seen up 0.4% from March. The PCE core price index is seen up 4.6%, year-on-year, which is the same as seen in the March report.

Why did Turkey sell nearly 100 tonnes of gold in April and March?

The key outside markets today see the U.S. dollar index weaker on a corrective pullback after hitting a two-month high Thursday. Nymex crude oil prices are firmer and trading around $72.25 a barrel. Meantime, the benchmark 10-year U.S. Treasury note yield is presently fetching 3.783%.  

Other U.S. economic data due for release Friday includes durable goods orders, the advance economic indicators report and the University of Michigan consumer sentiment survey.

Live 24 hours gold chart [Kitco Inc.]

Technically, the gold futures bulls have the overall near-term technical advantage but have faded recently. Prices hit a nine-week low overnight and are trending down on the daily bar chart. Bulls’ next upside price objective is to produce a close in June futures 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 Thursday’s high of $1,965.40 and then at this week’s high of $1,987.90. First support is seen at the overnight low of $1,936.00 and then at $1,925.00. Wyckoff's Market Rating: 6.0

Live 24 hours silver chart [ Kitco Inc. ]

The silver bears have the overall near-term technical advantage. Prices hit a two-month low overnight and are trending lower on the daily chart. Silver bulls' next upside price objective is closing July futures 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 $23.655 and then at $24.00. Next support is seen at $23.00 and then at the overnight low of $22.785. Wyckoff's Market Rating: 4.0.

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.