Solid gains for gold as price pushing closer to record high – Kitco NEWS

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(Kitco News) – Gold and silver prices are higher in early U.S. trading Friday, with gold scoring a 1.5-year high of $2,027.80 and silver an eight-month high of $26.66. The all-time high in Comex gold futures was set in August of 2020, at $2,063.00. Safe-haven demand is featured this week amid the intensifying war between Russia and Ukraine. April gold futures were last up $23.30 at $2,019.30 and May Comex silver was last up $0.665 at $26.40 an ounce.

Global stocks markets were mixed overnight and the U.S. stock indexes are pointed toward mixed openings when the New York day session begins. The Nasdaq stock index has moved into bear market territory—down 20% from its high. The Dow Jones Industrial Average is now in correction territory, meaning down 10% from its high. Risk aversion remains elevated amid the Russia-Ukraine war.

With the Russia-Ukraine war intensifying along with marketplace uncertainty and anxiety, and with both countries being major raw commodity producers and exporters, it would seem raw commodity futures markets’ prices still have more room on the upside—even as many raw commodity markets are at multi-year and even record highs. However, there are some early warning signs the explosive gains in commodities may be close to peaking. Remember that futures markets incorporate into their prices’ structures all known and expected fundamental factors. The copper market, called by traders “Dr. Copper” because of the red industrial metal’s worldwide importance and its history of foretelling price moves in other markets including stocks, on Monday soared to a record high above $5.00 a pound, only to promptly reverse course and close sharply down on the day. That price action produced a big and bearish “key reversal” down on the daily bar chart. That’s one technical clue of a price top in a market. Also, crude oil prices spiked sharply up Monday, only to back way down from its daily high—suggesting the bulls in that key market may have run out of gas. Neither I nor anyone else knows when major market tops occur. However, this market watcher of nearly 40 years has seen his share of major market tops, and they occur in situations similar to what many commodity markets are experiencing now. The majority of major market tops occur when traders and investors least expect them and many times before the actual bullish fundamental event that sparked the bull market move ever fully plays out.

The price of nickel more than doubled to $100,000 a ton before paring gains and eventually seeing trading suspended on the London Metal Exchange. Reports said the LME calculated margin calls at the Monday closing price of $48,000 and is considering whether to adjust or cancel the trades made between then and the suspension.

The key outside markets see Nymex crude oil prices are higher and trading around $122.50 a barrel. The all-time high in nearby Nymex crude oil prices was scored in July of 2008, at $147.27 a barrel. The U.S. dollar index is weaker today after hitting a 21-month high Monday. The benchmark U.S. 10-year Treasury note is presently yielding 1.851%.   

U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and chain store sales reports, the NFIB small business index, the U.S. trade report, the IDB/TIPP economic optimism index and monthly wholesale trade.

Live 24 hours gold chart [Kitco Inc.]

Technically, the April gold futures bulls have the strong overall near-term technical advantage. Prices are in a five-week-old uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close in April futures above major resistance at the record high of $2,063.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $1,950.00. First resistance is seen at the overnight high of $2,027.80 and then at $2,050.00. First support is seen at $2,000.00 and then at today’s low of $1,985.80. Wyckoff’s Market Rating: 9.0

Live 24 hours silver chart [ Kitco Inc. ]

May silver futures bulls have the solid overall near-term technical advantage. Prices are in a five-week-old uptrend 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 the overnight high of $26.66 and then at $27.00. Next support is seen at $26.00 and then at the overnight low of $25.55. Wyckoff’s Market Rating: 7.5.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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