(Kitco News) – Gold and silver prices are sharply lower in early U.S. trading Monday, on profit-taking pressure and weak long liquidation in the futures markets. There has also been a perceived easing of tensions in the Middle East, which is a negative for the safe-haven metals. June gold was last down $57.50 at $2,356.20. May silver was last down $1.309 at $27.50.
Broker SP Angel said today in an email dispatch: “Many gold miners will be forward selling into the new high price levels with the influx of new metal into futures markets likely to temper further price rises. The ability of to secure futures prices of $2,373 an ounce will likely bring in substantial tonnages of gold from miners looking to secure profits in the face of inflation.” Gold prices have been driven higher in recent weeks due in part by a marked rise in trading activity on China’s futures exchanges.
Asian and European stock indexes were mixed to firmer overnight. U.S. stock indexes are pointed to toward higher openings when the New York day session begins.
In other news China’s central bank left its benchmark lending rates unchanged Monday, in line with market expectations. One-year and five-year prime loan rates were kept at 3.45% and 3.95%, respectively.
The key outside markets today see the U.S. dollar index a bit firmer. Nymex crude oil prices are near steady and trading around $83.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is fetching 4.64%.
U.S. economic data due for release Monday includes the Chicago Fed national activity index.
Technically, the gold futures bulls have the solid overall near-term technical advantage. A nine-week-old uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close in June futures above solid resistance at the contract high of $2,448.80. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $2,250.00. First resistance is seen at $2,375.00 and then at $2,400.00. First support is seen at $2,350.00 and then at $2,337.00. Wyckoff’s Market Rating: 7.5.
The silver bulls have the solid overall near-term technical advantage but are fading just a bit. Prices are in a nine-week-old uptrend on the daily bar chart. Silver bulls’ next upside price objective is closing May futures prices above solid technical resistance at $30.00. The next downside price objective for the bears is closing prices below solid support at $26.00. First resistance is seen at $28.00 and then at $28.25.
Next support is seen at $27.00 and then at $27.575. Wyckoff’s Market Rating: 7.5.
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