Gold Price Analysis – Price pressure on gold, silver despite mild risk aversion
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(Kitco News) – Gold and silver prices are moderately lower in early U.S. trading Monday, as bulls are disappointed their safe-haven metals are not seeing a bid from a so far mild “risk-off” marketplace mentality to start the trading week. A stronger U.S. dollar index recently remains a negative element for the metals markets. April gold futures were last down $9.50 at $1,722.80 and May Comex silver was last down $0.269 at $24.845 an ounce.
The marketplace Monday morning is buzzing and still a bit nervous over news that a large investment fund, Archegos Capital Management, late last week quickly dumped $30 billion in holdings, including big positions in Viacom CBS and Discovery, possibly because the firm was over-leveraged and got margin calls. There was some concern about a contagion effect roiling the marketplace this week and some investment banks’ stocks shares dropped sharply overnight, but so far the stock and financial markets, in general, are not reacting significantly to the matter. If the markets to see a contagion effect, gold and silver markets could quickly see bids coming in.
Global stock markets were near steady to firmer overnight. U.S. stock indexes are pointed toward steady to weaker openings when the New York day session begins. Today is a holiday-shortened week for many countries that will see their markets closed on Friday to observe the Good Friday holiday ahead of Easter Sunday, including the U.S.
President Biden is set to unveil on Wednesday the first of two expected portions of the next phase of his U.S. economic agenda: a series of infrastructure proposals. The package would cost $3 trillion to $4 trillion and will likely include billions in new tax revenue.
The world continues to watch as salvage operations have partially moved the massive container ship that has been wedged in the Suez Canal, forcing its closure. Officials are staying the boat is now partially dislodged from one side of the canal but also say the toughest part of completely refloating the ship lies ahead. Oil prices were pressured a bit on this news.
The key outside markets today see the U.S. dollar index near steady after hitting a 4.5-month high late last week. Nymex crude oil prices are slightly higher and trading around $61.35 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 1.657%.
U.S. economic data due for release Monday is light and includes the Texas manufacturing outlook survey.
Technically, the April gold futures bears have the overall near-term technical advantage. Bulls’ next upside price objective is to produce a close in April futures 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 the overnight high of $1,732.60 and then at $1,740.00. First support is seen at last week’s low of $1,718.80 and then at $1,700.00. Wyckoff’s Market Rating: 3.5
May silver futures bears have the overall near-term technical advantage. Prices are in a two-month-old downtrend on the daily bar chart. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $26.00 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 the overnight high of $25.15 and then at $25.50. Next support is seen at the overnight low of $24.755 and then at the March low of $24.435. Wyckoff’s Market Rating: 3.5.
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