Gold & Silver Continue To Test Key Support Levels

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Last Friday the May Non-Farm Employment numbers were reported. This report showed an increase of 339,000, compared to 190,000 that was forecasted. Plus, the unemployment rate rose slightly to 3.7% for May. This news caused concerns that the Federal Reserve may increase the Fed Funds rate later this month to slow down the economy. Gold and Silver reacted negatively to this news, with Gold dropping $25 immediately after the news was released. This news also drove both the U.S. Dollar Index and 10-Year Treasuries higher.

Until the May Non-Farm employment numbers were released, Gold had tested the key $1,950 support level earlier in the week and reached a high of $1,982 last Thursday.

Now that the debt ceiling legislation is behind us, Gold needs to find major price support and move back above the key $1,950 support level to stay short-term bullish.

Gold is showing strong appeal and robust demand from central banks, which bought a record high 1,087 tons of Gold last year. That buying spree continued into 2023. During the first three months, central banks added a total of 228 tons to global reserves, which is the highest rate of purchases seen in a first quarter, reported by World Gold Council

Gold closed last Friday at $1,948 per ounce, up $5 for the week.

Today: Gold reached a low of $1,937 this morning as a reaction to last week's Non-Farm Employment numbers, a strong Dollar and higher 10-Year Treasuries. But then the SEC announced a major lawsuit against Bitcoin, Gold quickly rallied back above the key $1,950 resistance level and kept on going.

Silver showed excellent price support last week, staying above the $23 per ounce support level and briefly testing the $24 per ounce resistance level. Silver showed more price support last Friday after the May employment numbers were released, closing at $23.68, up $0.33 for the week. The Gold-to-Silver ratio has tightened to 82-to-1.

Today: Silver fell with Gold, reaching $23.21 before bargain buying appeared. Silver then rallied with Gold back above the $23.50 per ounce support level.

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