Mild price pressure on gold and silver as USDX strengthens

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(Kitco News) – Gold and silver prices fell slightly in early US trade on Wednesday. A bullish US Dollar Index hitting a six-week high overnight and heading higher is a massively bearish outsider element working against the metals market bulls midweek. Gold for June was last down $1.80 at $1,991.20, and silver in July was down $0.038 at $23.855.

Asian and European stock markets were mixed overnight. US stock indices are pointing to firmer openings when the daily New York session begins. The risk appetite of traders and investors is keener in the middle of the week. The US debt limit extension talks held on Tuesday afternoon were upbeat. President Joe Biden and House Speaker Kevin McCarthy appointed top envoys to negotiate a deal to avoid an unprecedented national stumble. Biden has cut short an upcoming foreign trip in hopes of striking a deal before the June 1 deadline.

The market continues to monitor the comments made by Federal Reserve officials this week. While their views were mixed on whether or not to continue tightening US monetary policy, traders and investors in general see their collective feedback as still a bit hawkish.

In the evening news, the Eurozone CPI for April rose 7.0% year-on-year, fully in line with market expectations.

Today, major overseas markets are seeing a rally in the US Dollar Index, while the dollar bulls are enjoying momentum. Crude oil prices on NYMEX are more stable and are trading around $71.15 per barrel. Meanwhile, the benchmark 10-year US Treasury yield is currently at 3.528%.

US economic data due for release on Wednesday includes the Department of Business’s weekly survey of mortgage applications, new residential construction, and the Department of Energy’s weekly Liquid Energy Inventories report.

24 hour gold chart [Kitco Inc.]

Technically, the gold futures bulls have a strong overall technical advantage in the near term. The next bullish price target for the bulls is to achieve a close in the June futures contract above the strong resistance at the May high of $2,085.40. The bears’ next bearish price target in the near term is pushing futures prices below the strong technical support level at $1,980.00. We see the first resistance at $2,000.00 and then $2,007.00. The first support is seen at the overnight low of $1,986.80 and then at $1,980.90. Wyckoff Market Rating: 7.0

24 hour live silver chart [ Kitco Inc. ]

The bulls and silver bears on a near-term overall level are the technical playing field but the bulls are fading. The next upside price target for the silver bulls is for the July futures price to close above the strong technical resistance at $25.00. The next downtrend price target for the bears is to close the price below the strong support level at $23.00. We see first resistance at $24.00 and then this week’s high at $24.395. The next support is seen at today’s low of $23.76 and then $23.50. Wyckoff Market Rating: 5.0.

Disclaimer: The opinions expressed in this article are those of the author and may not reflect the opinions of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; However, Kitco Metals Inc. cannot. Nor does the author guarantee this accuracy. This article is for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. does not accept The author of this article will not be held liable for losses and/or damages arising from the use of this publication.

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