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Gold and silver prices are sharply higher and hit 10- and nine-week highs, respectively, in midday U.S. trading Thursday. The metals were lifted in part by a more bullish technical picture for both, a lower U.S. dollar index and U.S. Treasury bond yields backing off a bit from this week’s highs. June gold futures were last up $32.00 at $1,816.30 and July Comex silver was last up $1.023 at $27.55 an ounce.
The gold market pushed above what was key technical resistance at the $1,800.00 level and set off pre-placed buy stop orders in the futures market to propel prices even higher.
It could also be that increasing worries about global inflation becoming problematic in the coming months are prompting the buying of gold and silver as a hedge against serious inflationary pressures that could occur down the road. There are more and more clues surfacing to suggest inflation will rise beyond what central banks and governments want to see.
In another sign of stronger consumer and commercial demand for goods that adds to the inflation argument, shipping giant Maersk reportedly said there are not enough ships in the world to meet container shipping demand. Maersk handles around 20% of global container traffic. The shortage of container ships and problems with the location of many containers has helped to more than triple container rates over the past year.
The key outside markets today see the U.S. dollar index lower. Nymex crude oil prices are lower and trading around $64.85 a barrel. Meantime, the yield on the benchmark 10-year U.S. Treasury note is presently fetching around 1.58%.
The key U.S. data point of the week and arguably of the month comes Friday morning with the Labor Department’s Employment Situation Report for April. Non-farm payrolls are seen up 1 million compared to a rise of 916,000 in March. The unemployment rate is seen at 5.8% versus 6.0% in March.
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Technically, June gold futures bulls have the overall near-term technical advantage and gained more power today. A five-week-old uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,850.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,754.60. First resistance is seen at today’s high of $1,818.60 and then at $1,825.00. First support is seen at $1,800.00 and then at today’s low of $1,781.80. Wyckoff's Market Rating: 6.5
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July silver futures prices hit a nine-week high today. The silver bulls have the overall near-term technical advantage and gained more power today. A five-week-old uptrend on the daily bar chart is in place. Silver bulls' next upside price objective is closing prices above solid technical resistance at $28.475 an ounce. The next downside price objective for the bears is closing prices below solid support at last week’s low of $25.745. First resistance is seen at today’s high of $27.585 and then at $28.00. Next support is seen at $27.00 and then at $26.765. Wyckoff's Market Rating: 6.5.
July N.Y. copper closed up 775 points at 460.15 cents today. Prices closed near the session high today and hit a contract and nearly 10-year high. The copper bulls have the strong overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 475.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 430.00 cents. First resistance is seen at today’s contract high of 460.30 cents and then at 465.00 cents. First support is seen at 455.00 and then at 450.00 cents. Wyckoff's Market Rating: 9.5.
By Jim Wyckoff
For Kitco Newss
