Gold, Silver & Oil Rally As U.S. Dollar Sinks

(Kitco News) - Gold and silver prices posted solid gains Monday, amid bullish “outside markets” that saw the U.S. dollar index lower and crude oil prices higher. Both precious metals markets hit nearly three-week highs today. June Comex gold was last up $13.80 at $1,257.50 an ounce. May Comex silver was last up $0.551 at $15.935 an ounce.
The U.S. dollar index dropped to an eight-month low Monday as prices continue to trend lower in the wake of perceived dovish rhetoric coming from U.S. Federal Reserve officials. Meantime, Nymex crude oil prices pushed above $40.00 a barrel Monday as there are near-term technical clues this market has bottomed out. A major oil-producers’ meeting is scheduled for next Sunday, at which time participants will discuss limiting their production levels.
World stock markets were mixed overnight. China’s equities market rose in part due to an upbeat inflation report that showed China’s domestic consumer price inflation rising 2.3% in March, year-on-year, and unchanged from February. China’s central bank wants to see an annual inflation rate of 3.0%. Traders and investors reckon this latest reading below 3.0% will allow the central bank to initiate further economic stimulus measures.
Japan’s stock market was weaker Monday on continued worries about the appreciation of the Japanese yen against other major world currencies, especially the U.S. dollar. U.S. stock indexes were firmer Monday afternoon.

In overnight news, the Paris-based OECD think tank issued a report that forecasts continued slowing world economic growth in the coming months. The report did say the decline in China’s economic growth rate will stabilize.
There were no major U.S. economic reports released Monday.
Technically, June gold futures prices closed near the session high. Gold bulls have the overall near-term technical advantage and gained some fresh upside momentum today. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the March high of $1,287.80. Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at 1,225.00. First resistance is seen at the February high of $1,264.10 and then at $1,273.00. First support is seen at $1,250.00 and then at today’s low of $1,241.60. Wyckoff’s Market Rating: 7.0
May silver futures prices closed near the session high today and hit a three-week high. The silver market bulls now have the overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at the March high of $16.17 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $15.20. First resistance is seen at $16.17 and then at $16.25. Next support is seen at $15.85 and then at $15.55. Wyckoff’s Market Rating: 6.0.
May N.Y. copper closed up 30 points at 209.00 cents today. Prices closed near mid-range. The copper bears have the solid overall near-term technical advantage. Copper bulls’ next upside breakout objective is pushing and closing prices above solid technical resistance at 220.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 200.00 cents. First resistance is seen at today’s high of 210.50 cents and then at 213.00 cents. First support is seen at last week’s low of 207.05 cents and then at 205.00 cents. Wyckoff’s Market Rating: 2.5.