(Kitco News) - Gold prices are showing triple-digit losses in midday U.S. trading, on strong profit-taking pressure from the shorter-term traders, as well as weak long liquidation, after prices spiked to a record high of $3,509.90, basis June Comex futures, on Tuesday. A return of risk appetite to the general marketplace at mid-week, evidenced by rallies in global stock markets, is also bearish for the safe-haven metal. The gold bulls appear to be fully exhausted at present, suggesting a near-term market top is in place. June gold was last down $121.20 at $3,297.60. May silver prices hit a three-week high today and were last up $0.66 at $33.565.
U.S. stock indexes are sharply higher today, following Tuesday’s solid gains. Risk appetite has indeed returned to the general marketplace at mid-week. President Trump said Tuesday he has “no intention” of firing Federal Reserve Chair Jerome Powell, despite Trump’s recent public attacks. Speaking in the Oval Office, Trump said, “Never did,” when asked about Powell’s job security and possibly firing Powell. Trump continues to push for aggressive U.S. rate cuts, saying, “This is a perfect time to lower interest rates,” and expressing frustration that Powell has not acted swiftly. Still, he acknowledged Powell’s legal protection.
Separately, Trump appeared to soften his stance in his trade war with China, saying U.S.-imposed tariffs of 145% on imported goods from China will come down “substantially” after the two sides negotiate a deal. The tariff levels “won’t be anywhere near that high,” Trump said, answering questions in the Oval Office. “It will come down substantially, but it won’t be zero.” Trump said in the Oval Office that “we’re doing fine with China,” and suggested the U.S. won’t play hardball or raise the issue of Covid-19. “We’re going to be very nice,” he said. “Ultimately they have to make a deal.”
The key outside markets are bearish for metals today and see the U.S. dollar index higher on a rebound after hitting a three-year low Monday. Nymex crude oil futures prices are lower and trading around $62.00 a barrel, on reports OPEC might increase its oil output. The yield on the benchmark 10-year U.S. Treasury note is presently at around 4.3%, down a bit from earlier this week.
Technically, June gold futures bulls have the overall near-term technical advantage but are fading and appear exhausted. Bulls’ next upside price objective is to produce a close above solid resistance at the contract high of $3,509.90. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $3,200.00. First resistance is seen at $3,350.00 and then at today’s high of $3,396.00. First support is seen at today’s low of $3,270.80 and then at $3,250.00. Wyckoff's Market Rating: 7.0.
May silver futures bulls have the firm overall near-term technical advantage. Prices are in an uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $35.00. The next downside price objective for the bears is closing prices below solid support at $32.00. First resistance is seen at today’s high of $33.675 and then at $34.00. Next support is seen at $33.00 and then at $32.50. Wyckoff's Market Rating: 7.0.
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