(Note: After serving you, my valued Kitco reader for the past 16 years, today is my last day at Kitco. I want to thank you for your loyalty to me and thank Kitco for the opportunity to serve you. I have the highest regard for Kitco and its leaders. I will especially miss the Kitco News team--and will miss you, too! - Jim)
(Kitco News) - Gold and silver prices are solidly higher near midday Thursday, as solid losses in the U.S. dollar index today are prompting precious metals traders to step in and do some perceived bargain hunting after recent losses. June gold was last up $67.30 at $4,629.40. May silver prices were up $1.646 at $73.16.
Metals traders got a mixed bag of U.S. economic data today. The world’s largest economy expanded 2% in Q1, picking up from a modest 0.5% gain in Q4 but below market expectations of 2.3% growth, partly reflecting a bounce-back from the previous quarter’s government shutdown. However, initial jobless claims fell by 26,000 from the previous week to 189,000 in the period ending April 25th, well below market expectations of 215,000, to mark the lowest since 1969. The two reports worked to offset each other and did not have much impact on gold and silver prices.
Federal Reserve officials left U.S. interest rates unchanged Wednesday, as fully expected, but revealed a deepening division over the outlook for policy amid increased uncertainty caused by the conflict in the Middle East. Four officials voted against the decision, including three who objected to language in their post-meeting statement that suggested the central bank would eventually resume cutting rates. Meantime, Fed Chair Jerome Powell said he intends to remain at the central bank as a member of its Board of Governors, and will not leave until a controversial criminal investigation into the central bank is "well and truly over with transparency and finality."
The key outside markets today see the U.S. dollar index solidly down, while Nymex WTI crude oil prices are lower and trading around $105.00 a barrel. The yield on the benchmark 10-year U.S. Treasury yield is presently around 4.4%.
Note: The gold market operates through two primary pricing mechanisms. The first is the spot market, which quotes prices for on-the-spot purchase and immediate delivery. The second is the futures market, which sets prices for delivery at a future date. Due to year-end positioning market liquidity, the December gold futures contract is currently the most actively traded on the CME.
Technically, June gold futures bulls’ next upside price objective is to produce a close above solid resistance at the April high of $4,917.70. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,300.00. First resistance is seen at $4,700.00 and then at this week’s high of $4,745.80. First support is seen at $4,600.00 and then at the overnight low of $4,550.80. Wyckoff's Market Rating: 5.0.
May silver futures see the next upside price objective for the bulls is closing prices above solid technical resistance at the April high of $83.245. The next downside price objective for the bears is closing prices below solid support at $70.00. First resistance is seen at $75.00 and then at this week’s high of $76.555. Next support is seen at this week’s low of $70.885 and then at $70.00. Wyckoff's Market Rating: 5.0 .
