Gold price recovers early losses as bulls step in to buy the dip

 New York (May 13)  Gold prices are modestly up in midday U.S. trading Thursday as bullish traders stepped in to do some bargain hunting when prices were moderately lower in the early going. The U.S. dollar index lost its overnight highs and that also aided the gold market bulls. Silver is a bit weaker today on some mild profit taking, but both metals remain in price uptrends on the daily charts, to suggest the path of least resistance for prices will remain sideways to higher in the near term. June gold futures were last up $2.60 at $1,825.60 and July Comex silver was last down $0.104 at $27.14 an ounce.

Today's U.S. producer price index report for April came in at up 0.6% from March, which was double the 0.3% rise that was forecast. The April CPI was up over 6%, year-on-year. The PPI report followed a hot consumer price index report issued on Wednesday. Evidence continues to build that the U.S. economy and even other major global economies are going to have to battle unwanted inflationary pressures at some point down the road. That's very likely going to be ultimately bullish for the metals markets, which are hard assets that history shows tend to appreciate during times of problematic inflation.

Global stock markets were solidly lower overnight. U.S. stock indexes are higher in midday trading on a rebound from big losses Wednesday. The equities bulls are still on the ropes late this week following this week's strong selling pressure that negated near-term price uptrends on the daily bar charts for the U.S. stock indexes, which is a technical clue the indexes have put in price tops. Traders and investors are pondering the old trading adage, "Sell in May and go away."

The marketplace is still keeping an eye on the worsening flare-up in the Middle East, as Israel and Hamas have ratcheted up their missile strikes against each other. The military action between the two is the most intense since 2014.

The key outside markets today see the U.S. dollar index slightly up at midday. Meantime, Nymex crude oil prices are sharply lower and trading around $63.25 a barrel. The U.S. Colonial pipeline system that had been shut down due to a cyberattack has reopened. The yield on the benchmark 10-year U.S. Treasury note is on the rise late this week and is presently fetching around 1.65%.

Technically, June gold futures bulls have the overall near-term technical advantage. A six-week-old price uptrend is in place on the daily bar chart. Bulls' next upside price objective is to produce a close above solid resistance at $1,850.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,775.00. First resistance is seen at $1,836.00 and then at this week's high of $1,846.30. First support is seen at today's low of $1,808.40 and then at $1,800.00.

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