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(Kitco News) – Gold and silver prices are down in midday U.S. trading Thursday, with silver hitting a two-month low. A stronger U.S. dollar and a breakdown in the crude oil market this week have the metals market bulls running for cover. April gold futures were last down $5.50 at $1,727.70 and May Comex silver was last down $0.176 at $25.055 an ounce.
A feature in the market place this week has been an appreciating U.S. dollar on the foreign exchange market and a big drop in crude oil prices. These key “outside markets” today see the U.S. dollar index higher and hitting another four-month high overnight as the greenback bulls have restarted a price uptrend on the daily bar chart. The U.S. Treasury 10-year note yield is fetching 1.623% Wednesday. Rising bond yields in the U.S. that are outpacing government bond yields in other countries are inviting capital flows into the greenback, including from the Euro currency. The U.S. is beating the Euro zone on economic growth prospects and on the Covid-19 battle. Meantime, Nymex crude oil prices are lower today and trading around $58.50 a barrel. A giant container ship stuck in the Suez Canal is disrupting world shipping, including that of crude oil. One has to wonder if crude oil prices would be even lower this week had not the canal blockage occurred.
Global stock markets were mixed overnight, with European shares mostly weaker and Asian shares mostly firmer. U.S. stock indexes are mixed at midday.
One other thing the market will be keeping a close eye on Thursday is the auction of $62 billion in seven-year U.S. Treasury notes at midday. This auction comes after February’s Treasury note auction flop that prompted a big sell-off in U.S. Treasuries.
Technically, April gold futures bears have the overall near-term technical advantage. However recent price gains and sideways price action begin to suggest a market bottom is in place, as a price downtrend line on the daily bar chart has been at least temporarily negated. Bulls’ next upside price objective is to produce a close above solid resistance at $1,775.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the March low of $1,673.30. First resistance is seen at this week’s high of $1,747.00 and then at the March high of $1,754.20. First support is seen at this week’s low of $1,722.30 and then at last week’s low of $1,716.60. Wyckoff’s Market Rating: 3.5
May silver futures prices hit a two-month low early on. The silver bears have the overall near-term technical advantage. Prices are in a seven-week-old downtrend on the daily bar chart. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $26.74 an ounce. The next downside price objective for the bears is closing prices below solid support at the January low of $24.095. First resistance is seen at $25.43 and then at $26.00. Next support is seen at today’s low of $24.435 and then at $24.095. Wyckoff’s Market Rating: 3.5.
May N.Y. copper closed down 810 points at 398.30 cents today. Prices closed near mid-range today and hit a three-week low. The copper bulls have the overall near-term technical advantage. However, a 12-month-old uptrend on the daily bar chart has stalled out and prices are starting to trend down. Copper bulls’ next upside price objective is pushing and closing prices above solid technical resistance at 420.00 cents. The next downside price objective for the bears is closing prices below solid technical support at the March low of 384.90 cents. First resistance is seen at today’s high of 404.60 cents and then at 410.50 cents. First support is seen at today’s low of 394.20 cents and then at 390.00 cents. Wyckoff’s Market Rating: 6.5.
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.