A weaker U.S. dollar index and a drop in U.S. Treasury yields at the middle of the week have helped gold and silver prices rise sharply in early U.S. trade today. There is an old saying in dealing that says markets will do anything to make traders unhappy. This seems to be what’s happening right now with the safe-haven metals: they drop when people are less willing to take risks and rise when people are more willing to take risks. It looks like metals buyers today are more worried about how inflation might go down if the war in the Middle East ends. And people who have been following the gold market for a long time remember when inflation fears caused the price of gold to rise. The last time gold prices changed, they went up $177.60 to $4,580.10. May silver prices were up $3.836 at $73.415.
What’s new with the war in Iran?
The United States sent Iran a 15-point peace plan. The plan includes ending sanctions, working together on domestic nuclear projects, stopping Iran’s nuclear programme, putting limits on missiles, and letting ships pass through the Strait of Hormuz. The US is waiting for Iran’s answer. Trump says Iran wants to work out a deal.
Tehran has been saying that the U.S. is negotiating with itself, which means they are not going to make any concessions.
The US is sending an extra 2,000 soldiers to the Middle East. They will join the 5,000 soldiers who are already there and will start arriving in the next few days.
Iran has kept attacking Israel and Arab Gulf states all night, but no one has been hurt.
As head of the BRICS group, India is under pressure to get the other countries in the group to take a stronger stance on the Iran conflict.
Iran’s long-range rockets are doing more damage because they are harder to catch.
On Trump’s peace push, stocks around the world rise and crude oil prices drop.
A bad U.S. Treasury sale is a sign that inflation is about to become a problem. Tuesday, the prices of U.S. Treasury notes fell and yields went up because buyers avoided an auction of two-year Treasury notes because they were afraid that an oil-fueled rise in inflation could cause the war in the Middle East to last for a long time. Some people didn’t buy the $69 billion worth of two-year notes that were sold on Tuesday, and the Wall Street Journal said that the US is planning to send about 3,000 troops to the Middle East. This caused losses to get worse… As oil prices went up, yields on all terms went up, but two-year yields went up the most, by up to 10 basis points, to 3.96%. A report from Bloomberg said that David Robin, an interest-rate strategist at TJM Institutional Services LLC, said that the auction “was unfortunately brought to market in a very difficult, unsettled, and uncertain period.” “Why make a promise?” “The risk-reward scale is heavily skewed towards risk,” he said. The two-year notes were sold at 3.936%, which was higher than their yield in trading before the auction, right before the limit for bids. This shows that demand wasn’t as high as expected. It was the best two-year auction return since May of last year.
A Fed source said that rates in the U.S. might need to stay the same for “some time.” On Tuesday, Michael Barr, the governor of the Federal Reserve, said that U.S. interest rates might need to stay the same for “some time” to deal with inflation that is well above the central bank’s goal of 2% per year. As reported by Bloomberg, Barr said, “While I am hopeful that inflation will fall as the effects of tariffs on prices wane later this year, I would like to see evidence that goods and services price inflation is sustainably retreating before I consider lowering the policy rate further, provided that labour market conditions remain stable.” Barr said these things in prepared remarks for an event in Phoenix on Tuesday.
Nymex WTI crude oil prices have dropped more than $5.00 a barrel and are now moving around $87.00 a barrel. The U.S. dollar measure is going down this morning. Right now, the yield on the standard 10-year U.S. Treasury bill is 4.33 percent.
Technically, the next price goal for bulls in April gold futures is to get a close above strong support at $4,750.00. In the short run, bears want to see futures prices fall below strong technical support at this week’s low of $4,100.00. The overnight high of $4,601.00 is the first level of resistance. The next level is $4,700.00. The overnight low of $4,458.20 and then $4,500.00 are both places where prices can be stopped. The market rating from Wyckoff is 4.0.
If you’re bullish on silver futures, the next price goal is to close above solid technical support at $80. The next price target for bears is for prices to close below strong support at $60.00. First, the overnight high of $74.80 is a threat, and then $75.00 is also. The overnight low of $71.31 and then $70.00 are the next levels of support. Rating from Wyckoff’s Market: 4.0
