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(Kitco News) – Gold and silver prices were trading solidly at the start of the US session on Wednesday, following a demand for refuge in a global economy that has turned into recession and possibly depression. The weekly jobless claims report in the United States on Thursday recalls the plight of the world’s largest economy. Gold futures in June rose for the last time from $ 21.70 an ounce to $ 1,706.50. May Comex silver prices were up $ 0.225 to $ 15.435 an ounce.
The weekly job application report has become the most important US data point. The current weekly number of unemployed is expected to increase by around 5 million after last week exceeding 6 million. Other reports released today include the producer price index, monthly wholesale trade, monthly chain store sales and the University of Michigan consumer sentiment survey. Federal Reserve Chairman Jerome Powell will also host a webinar today on the impact of the coronavirus on the US economy.
Global stock markets were tightly mixed in night trading. The US stock market indices are oriented towards slightly lower openings at the start of the New York session. It is the last trading day of the week for most markets, before the Good Friday holidays and the Easter weekend. The market hikes had a good week. US stock indexes have seen an upward trend in short-term prices, suggesting that at least short-term lows are in place. As the Covid-19 pandemic continues to kill thousands of people worldwide, the rate of spread of the disease appears to be slowing. The question among traders and investors now is whether the infection curve has actually flattened out when governments restart their paralyzed economies. May 1 is probably the most optimistic date for a partial recovery in the US economy.
Today, an OPEC (plus Russia) teleconference is at the center of discussions to discuss significant reductions in crude oil production. The latest reports indicate that Russia is planning a big cut. Many observers of the oil market are looking for a collective cut of 10 to 15 million barrels per day. A Texas oil regulator said his state could also cut oil production. Speculation that major reductions in global oil production will be approved by major producers rallied crude oil futures markets last week. Nymex crude oil prices are higher and are trading around $ 26.50 a barrel. Last week, prices fell below $ 20.00.
Other major markets are seeing the US dollar index weaken this morning. The yield on 10-year US Treasuries is trading around 0.73% Thursday morning. Gold prices are significantly higher and are trading above $ 1,700.00 an ounce.
Metals analysts said on Thursday morning: “The supply / demand balance of metals is a moving target right now, with daily news of mine closings in Mexico, Chile, Peru, Africa. of the South and in Zambia as well as in other places. The metal supply was also disrupted by border closings, port and shipping problems. Many containers remain blocked, which further complicates shipments. Hedge funds and CTAs reduced their positions before the Easter break and as the supply / demand relationship became less clear. Falling demand in China and the West was one of the main downward drivers for metal traders. China is restocking and Germany is emerging from isolation, showing the way to recovery. Nations with shorter locks will likely gain an economic advantage over their commercial competitors. “
Technically, gold bulls have the solid overall short-term technical advantage amid an upward price trend in place on daily, weekly and monthly charts. This strongly suggests that the path of least resistance for prices will remain laterally higher at least in the short term and probably longer. Bulls’ next bullish price target is to produce a close in June on resistance above $ 1,750.00. Bears’ next short-term price cut target pushes futures prices under solid technical support to $ 1,650.00. The first resistance is observed at the night’s high of $ 1,710.00, then at $ 1,715.80. The first support is observed overnight low at $ 1,676.50 and then at $ 1,670.70. Wyckoff Market Assessment: 8.5
Bulls on silver may have the overall short-term technical advantage and prices tend to rise on the daily bar chart. The next target for higher silver bull prices is to close prices above solid technical resistance at $ 16.00 an ounce. The next breakout price target for the bears is to close prices under solid support at $ 14.00. The first resistance was observed at $ 15.75 and then this week’s high at $ 15.93. The following support is seen at $ 15.00 then at $ 14.75. Wyckoff Market Assessment: 6.0.
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