Gold, Silver See Price Pressure as Bond Yields, USDX rise

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Mar 12, 2021 10:37 NY TimeKitco 10AM Silver Fix

(Kitco News, Fri. March 12, 2021) – Gold and  silver prices are solidly lower in early U.S. trading today, pressured by big rise in U.S. government bond yields overnight and by a higher U.S. dollar index to end the week. The still-bearish near-term technical postures for both metals are also inviting the shorter-term futures traders to the sell side. April gold futures were last down $23.80 at $1,698.80 and May Comex silverwas last down $0.633 at $25.56 an ounce. 

Government bond yields are on the rise again Friday after a very brief respite at mid-week, which has given stock market traders pause again. The closely watched U.S. Treasury 10-year note yield is now fetching 1.609% in early U.S. trading Friday, and back near the highest level seen in over a year. Rising bond yields are not yet at the levels that would produce problematic price inflation, but the trajectory of the rising yields is starting to concern some market watchers. Today, the U.S. gets an inflation report in the producer price index for February, expected to be up 0.5% from January and compares to a rise of 1.3% in January from December.

Global stock markets were mixed overnight. U.S. stock indexes are pointed mixed to weaker openings when the New York day session begins, on some profit taking and routine downside corrections following recent good gains that pushed the Dow and S&P 500 indexes to record highs on Thursday. Generally, trader and investor risk appetite is robust in the marketplace at present. There are no geopolitical flare-ups, major economies are healing rapidly from their pain of the pandemic and the U.S. government is set to roll out a $1.9 trillion spending package for Americans.

In other news, Bitcoin prices have risen to another record high late this week, above $58,000, before pulling back a bit today.

The key “outside markets” today see Nymex crude oil futures prices weaker and trading around $65.65 a barrel. Meantime, the U.S. dollar index is solidly higher early today. 

U.S. economic data due for release Friday includes the producer price index and the University of Michigan consumer sentiment survey.

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 the March low of $1,673.30. First resistance is seen at the overnight high of $1,726.10 and then at this week’s high of $1,738.00. First support is seen at the overnight low of $1,696.60 and then at $1,685.00.

May silver futures bears have the slight 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 $27.50 an ounce. The next downside price objective for the bears is closing prices below solid support at the March low of $24.845. First resistance is seen at $26.00 and then at today’s high of $26.235. Next support is seen at today’s low of $25.48 and then at $25.00. 
Posted by :

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com