Sharp downside corrections in gold & silver; bulls need to step up

 NEW YORK (Mar 9)  Gold and silver prices are sharply down in midday U.S. trading Wednesday, on heavy profit-taking from the shorter-term futures traders after gold futures hit a record intra-day high and silver hit an eight-month high on Tuesday. Strong losses in crude oil and other commodity markets today are also helping to pressure the precious metals markets. April gold futures were last down $53.40 at $1,989.80 and May Comex silver was last down $0.98 at $25.91 an ounce.

Key for the gold and silver markets will be if the bulls have the courage to step in and buy the big dips. One clue that market tops are in place in the gold and silver markets would be two strong down days in a row. Trading Thursday and Friday will be extra important in gold and silver, and the bulls need to step up and show some power to avoid serious near-term technical damage.

Global stocks markets were mixed overnight, with European shares mostly up and Asian shares mostly down. The U.S. stock indexes are solidly higher at midday. The U.S. indexes are seeing corrective bounces following recent losses, but are still in near-term price downtrends on the daily charts. Risk aversion remains elevated amid the ongoing Russia-Ukraine war. More and more U.S. companies are pulling away from Russia, including McDonalds and Coca Cola

The key outside markets see Nymex crude oil prices sharply lower and trading around $111.00 a barrel. The U.S. dollar index is sharply lower today after hitting a 21-month high Monday. The benchmark U.S. 10-year Treasury note is presently yielding 1.9%. Treasury yields are on the rise at mid-week.  

Technically, April gold futures bulls still have the firm overall near-term technical advantage but now appear exhausted. Prices are still in a five-week-old uptrend on the daily bar chart. Bulls' next upside price objective is to produce a close above solid resistance at the record high of $2,178.80. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,950.00. First resistance is seen at $2,000.00 and then at $2,025.00. First support is seen at today's low of $1,981.00 and then at $1,976.50.

KITCO