(Kitco News) – Gold and silver prices are firmly higher in early U.S. trading Friday. The two precious metals surprisingly showed very little reaction to another U.S. inflation report that came in a bit warmer than market expectations. The data fell into the camp of the U.S. monetary policy hawks, who want to see the Federal Reserve hold off on cutting interest rates. June gold was last up $17.80 at $2,360.00. May silver was last up $0.247 at $27.61.
The U.S. data point of the day Friday saw the personal income and outlays report for March that includes the PCE inflation indexes that the Federal Reserve watches very closely. The March PCE price index came in at up 2.7%, year-on-year compared to expectations for up 2.6%. Meantime, the core PCE index (excluding food and energy) came in up 2.8%, year-on-year versus marketplace expectations for up 2.7% on an annual basis. Thursday’s PCE inflation numbers in the 1Q GDP report also came in warmer than expected.
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 overnight news, DowJones Newswires reported that Chinese gold buyers, “spooked by a protracted property slump and recent stock market rout, are rushing toward gold as economic uncertainty looms, propelling a global bullion rally.” Gold consumption in China in the first quarter rose nearly 6% from a year earlier. China’s imports of gold raw materials rose by 78% in the same period.
The key outside markets today see the U.S. dollar index a bit higher. Nymex crude oil prices are up and trading around $84.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is fetching 4.677%. U.S. Treasury yields this week have hit five-month highs.
Other U.S. economic data due for release Friday includes the University of Michigan consumer sentiment survey.
Technically, the gold futures bulls have the firm overall near-term technical advantage. However, a nine-week-old uptrend on the daily bar chart has stalled out. Bulls’ next upside price objective is to produce a close in June futures above solid resistance at $2,400.00. 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 the overnight low of $2,338.00 and then at $2,325.00. Wyckoff’s Market Rating: 7.0.
The silver bulls have the firm overall near-term technical advantage. However, a nine-week-old uptrend on the daily bar chart has stalled out. Silver bulls’ next upside price objective is closing May futures prices above solid technical resistance at this week’s high of $28.795. The next downside price objective for the bears is closing prices below solid support at $25.00. First resistance is seen at $28.00 and then at $28.25. Next support is seen at this the overnight low of $27.285 and then at $27.00. Wyckoff’s Market Rating: 7.0.
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