Gold Weaker As Fed's Powell Maintains Hawkish Tone

(June 21, 2023 - Jim Wyckoff)

(Kitco News) - Gold prices are modestly down and silver prices are solidly lower in midday U.S. trading Wednesday. Both markets hit three-month lows today. Testimony before Congress from Fed Chairman Jerome Powell saw him lean hawkish, which is not a surprise. However, U.S. Treasury yields up-ticked after his remarks, which in turn put some more price pressure on the two precious metals markets. August gold was last down $6.00 at $1,942.10 and July silver was down $0.434 at $22.79.

Powell’s comments at his semi-annual monetary policy report to Congress on Wednesday and Thursday started with the House Financial Services Committee hearing today. Powell said interest rates are still too high and that the U.S. central bank will likely have to raise interest rates some more. The marketplace is closely watching the testimony for clues on the specific timing of a future U.S. interest rate increase.

Global stock markets were mostly lower overnight. U.S. stock indexes are lower near midday. The key outside markets today see the U.S. dollar index slightly lower. Nymex crude oil prices are higher and trading around $72.25 a barrel. Meantime, the benchmark 10-year U.S. Treasury note yield is presently fetching around 3.775%.

Technically, August gold futures prices hit a three-month low early on today. Bulls have lost their slight overall near-term technical advantage. Prices are in a six-week-old downtrend on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $2,000.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,900.00. First resistance is seen at today’s high of $1,950.40 and then at $1,960.00. First support is seen at today’s low of 1,929.30 and then at $1,920.00. Wyckoff's Market Rating: 5.0

July silver futures prices hit a three-month low today. The silver bears have the overall near-term technical advantage. A choppy price downtrend is in place on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the June high of $24.62. The next downside price objective for the bears is closing prices below solid support at $22.00. First resistance is seen at $23.00 and then at today’s high of $23.23. Next support is seen at today’s low of $22.515 and then at $22.25. Wyckoff's Market Rating: 4.0.

July N.Y. copper closed up 385 points at 392.20 cents today. Prices closed near the session high today and closed at a six-week high close. The copper bulls have the overall near-term technical advantage. Prices are in a four-week-old uptrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at 410.00 cents. The next downside price objective for the bears is closing prices below solid technical support at 370.00 cents. First resistance is seen at the June high of 392.70 cents and then at 395.00 cents. First support is seen at this week’s low of 384.45 cents and then at 380.00 cents. Wyckoff's Market Rating: 6.0.