Gold, silver bulls bask amid bullish charts, safe-haven buying

Gold futures prices are trading not far from unchanged on the day Tuesday at midday, after scoring a 7.5-year high early on, at $1,788.80, basis June Comex futures. Silver prices are sharply up and at a four-week high today. Gold bulls are enjoying the strong near-term technical advantage to continue to suggest more upside for the yellow metal in the near term. Safe-haven demand continues to boost gold, and to a lesser degree silver, as the global economy is still on very shaky ground. June gold futures were last up $0.10 an ounce at $1,761.30. May Comex silver prices were last up $0.503 at $16.04 an ounce.

Global stock markets were mostly higher in overnight trading. U.S. stock indexes are solidly higher at midday. More and more it appears North America and Europe have “turned the corner” on the Covid-19 pandemic. New York Governor Cuomo said Monday his state has seen the worst of the pandemic. Other hotspots in the U.S. have also showed signs of simmering down. Leading U.S. health officials are now saying the world’s largest economy can very likely begin to reopen in stages beginning in May.

The present Covid-19 situation appears to be a sweet spot for the precious metals. There is enough confidence in the marketplace for traders to want to trade markets, but the global economies are still in very bad shape and it’s uncertain when they will be fully operational or healed.

Major corporate earnings reports are now starting to be released, which will show the early impact of the Covid-19 pandemic, and be a sobering reminder of the tough economic times at present. JP Morgan’s results today were a testament of a crippled U.S. economy.

In overnight news, China, the world’s second-largest economy, saw its March exports down 6.6%, year-on-year, which was less than expected. Imports were down 0.9% in the period, also way less than expected. China watchers deemed this data as upbeat, showing the Chinese economy is recovering from the pandemic.

The important markets today see Nymex crude oil prices trading solidly lower, around $21.00 a barrel. Oil market bulls are sorely disappointed the weekend OPEC and other major oil producers agreement to restrict oil output did not boost crude oil futures prices. However, there is no consensus on how much oil production will be reduced. Some market watchers think 10 million barrels a day and the more optimistic bulls think 20 million. There is more agreement among analysts that worldwide oil demand has dropped by at least 20 million barrels a day.

Meantime, the U.S. dollar index is lower at midday. The 10-year U.S. Treasury note yield is trading around 0.735% today.

Technically, June gold futures bulls have the strong overall near-term technical advantage. More upside is likely in the near term. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,800.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,700.00. First resistance is seen at today’s high of $1,788.80 and then at $1,800.00. First support is seen at today’s low of $1,755.30 and then at $1,750.00. Wyckoff's Market Rating: 9.0

May silver futures prices were nearer the session high and hit a four-week high at midday. The silver bulls have the overall near-term technical advantage. Prices are in a four three-week-old uptrend on the daily bar chart. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $17.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $14.50. First resistance is seen at today’s high of $16.30 and then at $16.50. Next support is seen at today’s low of $15.655 and then at this week’s low of $15.385. Wyckoff's Market Rating: 6.5.

May N.Y. copper closed up 285 points at 233.10 cents today. Prices closed near the session high and closed at a four-week high close today. The copper bulls have the slight overall near-term technical advantage. A price uptrend is in place on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 250.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 220.00 cents. First resistance is seen at this week’s high of 235.25 cents and then at 238.00 cents. First support is seen at 230.00 cents and then at this week’s low of 226.35 cents. Wyckoff's Market Rating: 5.5.

 

 

By Jim Wyckoff
For Kitco News

David