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Gold, silver power higher amid improving chart postures, weak USDX

Jim Wyckoff Thursday May 06, 2021 13:10

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(***** News) - Gold and silver prices are sharply higher and hit 10- and nine-week highs, respectively, in midday U.S. trading Thursday. The metals were lifted in part by a more bullish technical picture for both, a lower U.S. dollar index and U.S. Treasury bond yields backing off a bit from this week’s highs. June gold futures were last up $32.00 at $1,816.30 and July Comex silver was last up $1.023 at $27.55 an ounce.

The gold market pushed above what was key technical resistance at the $1,800.00 level and set off pre-placed buy stop orders in the futures market to propel prices even higher.

It could also be that increasing worries about global inflation becoming problematic in the coming months are prompting the buying of gold and silver as a hedge against serious inflationary pressures that could occur down the road. There are more and more clues surfacing to suggest inflation will rise beyond what central banks and governments want to see.

In another sign of stronger consumer and commercial demand for goods that adds to the inflation argument, shipping giant Maersk reportedly said there are not enough ships in the world to meet container shipping demand. Maersk handles around 20% of global container traffic. The shortage of container ships and problems with the location of many containers has helped to more than triple container rates over the past year.