Gold sees solid price gains as bulls claw back

(Kitco News, Fri. April 29th, 2022) – Gold and silver prices are higher in early U.S. Trading Friday, with gold posting solid gains. Short covering from the shorter-term futures traders is featured, as well as some bargain hunting in the cash market. Risk aversion is keener on this last trading day of the week and of the month. June gold futures were last up $27.40 at $1,918.70 and May Comex silver was last up $0.321 at $23.45 an ounce.

Gold prices are seeing safe-haven demand as Europe grapples with its energy dependency on Russia, and Russia is putting the squeeze on supplying natural gas and oil to European countries. The Russia-Ukraine war appears to be intensifying with Western nations supplying more weapons to Ukraine. Russian President Vladimir Putin is ratcheting up his anti-West rhetoric. All of the above suggests an ultimate outcome that is not favorable.

A pull back in the U.S. dollar index and higher crude oil prices today are also bullish outside market elements for the metals markets.

Global stock markets were mostly firmer overnight. U.S. stock indexes are pointed toward lower openings when the New York day session begins. Amazon reported disappointing earnings results late Thursday. Apple reported good earnings but said Covid in China will likely constrain the company’s earnings in the current quarter.

Gold is an ‘ideal’ asset right now but why isn’t the price higher? Fidelity weighs in

Bloomberg today reported: “Non-dollar currencies, which came in for a hammering in recent days, got a respite on Friday. China’s Politburo vowed to boost stimulus measures, which revived sentiment toward the yuan and other currencies. The Politburo said it would ‘strengthen macro adjustments, strive to achieve full-year economic and social development goals, and keep the economy running within a reasonable range.'”

In other overnight news, the Eurozone got another piece of hot inflation data, as its consumer price index for April was up 7.5%, year-on-year. That was right in line with market expectations.

The key outside markets today sees Nymex crude oil futures prices firmer and trading around $106.00 a barrel. The yield on the 10-year U.S. Treasury note is presently fetching 2.844%.

U.S. economic data due for release Friday includes personal income and outlays, the employment cost index, the Chicago ISM business survey, and the University of Michigan consumer sentiment survey.

Technically, the June gold futures bears have the slight overall near-term technical advantage. A downtrend line is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close in April futures above solid resistance at $1,960.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $1,850.00. First resistance is seen at $1,925.00 and then at this week’s high of $1,935.50. First support is seen at $1,900.00 and then at the overnight low of $1,893.50.

May silver futures bears have the firm overall near-term technical advantage. Prices are trending down on the daily bar chart. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $24.50 an ounce. The next downside price objective for the bears is closing prices below solid support at $22.00. First resistance is seen at $23.765 and then at $24.00. Next support is seen at today’s low of $23.19 and then at $23.00.

Posted by:

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com