Gold, Silver Rebound as Bond Yields, USDX Retreat

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Mar 09, 2021 11:23 NY TimeKitco 10AM Silver Fix

(Kitco News, Tues. Mar. 9th, 2021)– Gold and  silver prices are solidly higher early today amid falling bond yields and weaker U.S. dollar index on this day, but mostly on corrective, short-covering bounces after gold hit a 10-month low on Monday. April gold futures were last up $24.50 at $1,702.00 and May Comex silver was last up $0.506 at $25.765 an ounce. 

Global stock markets were mixed to firmer overnight. U.S. stock indexes are pointed toward solidly higher openings when the New York day session begins. Bond market yields are on the retreat Tuesday, which is boosting trader and investor risk appetite and boosting share prices. The yield on the U.S. Treasury 10-year note was fetching 1.542% early today. Big hedge fund manager David Tepper on CNBC Monday predicted the rise in U.S. government bond yields has now mostly played out. Some other analysts on TV and in the media are saying the same. However, many just think Tepper and the others are just talking their book. This 35-year market watcher thinks the inflation genie is already out of the bottle.

The marketplace is also upbeat early this week as it appears the U.S. Congress will this week pass a $1.9 trillion pandemic stimulus package for Americans, to then be signed by President Biden.

In overnight news, the Paris-based OECD think tank forecast the global economy will rebound to pre-pandemic growth levels by the middle of this year, at 5.6% growth, but warned that strong U.S. economic growth could unbalance weaker world economies. The OECD sees the U.S. economy growing by 6.5% in 2021—double the pace it forecast in November. The group forecast China’s economic growth in 2021 at 7.8%.

The key “outside markets” today see Nymex crude oil futures prices higher and trading around $65.35 a barrel. Meantime, the U.S. dollar index is lower on a corrective pullback after hitting a 3.5-month high Monday. 

U.S. economic data due for release Tuesday is light and includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, and the NFIB small business optimism index.

Technically, the April gold futures bears have the solid overall near-term technical advantage amid a two-month-old price downtrend in place on the daily chart. Bulls’ next upside price objective is to produce a close in April futures above solid resistance at this week’s high of $1,757.40. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $1,650.00. First resistance is seen at this week’s high of $1,712.00 and then at $1,725.00. First support is seen at $1,681.30 and then at this week’s low of $1,673.30.

May silver futures bears have the overall near-term technical advantage. Prices are in a five-week-old downtrend on the daily bar chart. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $27.00 an ounce. The next downside price objective for the bears is closing prices below solid support at $24.00. First resistance is seen at $26.00 and then at $26.385. Next support is seen at today’s low of $25.09 and then at $25.00.

Posted by :

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com