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(Kitco News) – Gold prices are moderately higher and silver slightly lower in early U.S. trading Monday. Gold is getting a boost from sharply higher crude oil prices to start the trading week and the month of April. April gold was last up $9.20 at $1,978.10 and May silver is down $0.056 at $24.10.
The weekend surprise OPEC-plus cut in its collective crude oil production by just over 1 million barrels a day is on the front burner of the marketplace to start the trading week. Oil prices spiked on the news, with Nymex crude oil prices presently up nearly $3.94 a barrel at $79.60.
“It‘s a shock move by OPEC-plus as the cartel had previously vowed to maintain a steady supply. This is a significant reduction in a market in which supply was expected to be tight for the second half of 2023,” said Nigel Green of the deVere Group. “The production cuts could see prices close to $100 a barrel due to demand from a reopening China and as Russia has slashed production due to sanctions from the West. The dramatic cut will only add to pressing global inflationary squeezes.”
The OPEC oil-production-cut also raises the specter of higher inflation in the coming months that could force central banks to keep their interest rates higher for longer.
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward mixed openings when the New York day session begins.
The other key outside markets today see the U.S. dollar index slightly higher. The benchmark 10-year U.S. Treasury note yield is presently fetching 3.513%.
It‘s a busier day for U.S. economic data released Monday, including the U.S. manufacturing purchasing managers index (PMI), the ISM report on business manufacturing, the global PMI, construction spending and domestic auto industry sales.
Technically, the gold futures bulls have the firm overall near-term technical advantage. Prices are in an uptrend on the daily bar chart. A bullish symmetrical triangle pattern has formed on the daily bar chart. Bulls‘ next upside price objective is to produce a close in April futures above solid resistance at the March high of $2,014.90. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $1,900.00. First resistance is seen at last week‘s high of $1,986.80 and then at $2,000.00. First support is seen at the overnight low of $1,950.00 and then at last week‘s low of $1,945.00. Wyckoff’s Market Rating: 7.5
The silver bulls have the solid overall near-term technical advantage as prices hit a two-month high overnight. Prices are in a steep uptrend on the daily bar chart. Silver bulls’ next upside price objective is closing May futures prices above solid technical resistance at $25.00. The next downside price objective for the bears is closing prices below solid support at $22.50. First resistance is seen at the March high of $24.31 and then at $24.50. Next support is seen at the overnight low of $23.725 and then at $23.50. 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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