Gold, silver see good price gains as USDX erosion continues

(Kitco News, M9n. May 23rd, 2022) – Gold and silver prices are posting solid gains in early U.S. trading Monday, supported by the sharp losses in the U.S. dollar index that hit a four-week low overnight. Some safe-haven demand is also featured amid an overall marketplace that sees risk appetite far from robust. June gold futures were last up $20.70 at $1,862.50. July Comex silver futures were last up $0.486 at $22.165 an ounce.

Global stock markets were mixed but mostly up overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins. The U.S. stock index bulls are still on the ropes as the major indexes last week hit 12-month lows and are at or flirting with bear market territory—meaning prices 20% down from their recent highs.

Trader and investor risk appetite up-ticked just a bit to start the trading week on reports the U.S. may consider lifting some trade tariffs on China. Meantime, China continues to struggle with rising Covid cases that have locked down parts of major cities in the world’s second-largest economy.

In other overnight news, European Central Bank President Christine Lagarde said the ECB will likely raise interest rates at its July meeting.

U.S. President Joe Biden is on an Asian tour and Monday laid out a new economic cooperation platform called the Indo-Pacific Economic Framework.

The key outside markets today see Nymex crude oil futures prices higher and trading around $111.50 a barrel. Meantime, the U.S. dollar index is sharply down and hit a nearly four-week low in early trading. The yield on the 10-year U.S. Treasury note is fetching 2.815%.

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U.S. economic data due for release Monday is light and includes the Chicago Fed national activity index. The data pace picks up rapidly Tuesday.

Technically, the June gold futures bears have the overall near-term technical advantage but the bulls have gained momentum. A 2.5-month-old downtrend is still in place on the daily bar chart. However, more price gains this week would negate the uptrend. Bulls’ next upside price objective is to produce a close in June futures above solid resistance at $1,900.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the May low of $1,785.00. First resistance is seen at $1,875.00 and then at $1,883.00. First support is seen at the overnight low of $1,843.30 and then at Friday’s low of $1,830.60. Wyckoff’s Market Rating: 3.5.

July silver futures bears have the overall near-term technical advantage. Prices are in a 2.5-month-old downtrend on the daily bar chart. However, more price gains this week would negate the uptrend. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $23.00 an ounce. The next downside price objective for the bears is closing prices below solid support at the May low of $20.42. First resistance is seen at $22.25 and then at $22.50. Next support is seen at the overnight low of $21.765 and then at $21.50.

Posted by :

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com