Gold sets new record highs on safe-haven demand, bullish charts

Gold prices are solidly up, with June Comex futures hitting another contract/record high of $2,297.90 an ounce, in midday U.S. trading Tuesday. Silver prices are also posting sharp gains. Safe-haven demand is featured today as geopolitical tensions in the Middle East have ratcheted up. Technical buying is also seen in both precious metals amid bullish charts. June gold was last up $18.90 at $2,275.80. May silver was last up $0.797 at $25.865.

An air strike on the consular part of Iran’s embassy in Damascus, Syria, killed three senior members of Iran’s Revolutionary Guards. Iran blamed Israel for the strike. This is another escalation in the already-turbulent Middle East. Also, an Israeli air strike in Gaza killed seven innocent aid workers, stoking further global concerns about Israel’s aggressive offensive in Gaza.

Asian and European stock indexes were mixed but mostly firmer overnight. U.S. stock indexes are solidly lower near midday.

Featured in the marketplace early this week is rising U.S. Treasury yields following recent strong U.S. economic data, including Monday’s stronger-than-expected ISM manufacturing report. That has given the U.S. monetary policy doves pause on their notions of an interest rate cut coming as early as June. However, it appears the metals-bearish rising bond yields are being trumped on this day by metals-bullish safe-haven buying.

In other news, the Japanese yen sank to a 34-year low against the U.S. dollar today. Reads a DowJones Newswires headline today: “Yen intervention risk is rising, but effects could be short-lived.”

The key outside markets today see the U.S. dollar index lower. Nymex crude oil prices are higher, hit a five-month high, and are trading around $85.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently fetching around 4.4%--the highest this year.

Technically, June gold futures bulls have the strong overall near-term technical advantage. A six-week-old uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $2,400.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,200.00. First resistance is seen at the contract high of $2,297.90 and then at $2,300.00. First support is seen at today’s low of $2,267.10 and then at this week’s low of $2,249.10. Wyckoff's Market Rating: 9.5.

May silver futures prices were set to close at a four-month-high close today. The silver bulls have the firm overall near-term technical

advantage and are working on restarting a price uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the December high of $26.575. The next downside price objective for the bears is closing prices below solid support at last week’s low of $24.445. First resistance is seen at $26.575 and then at $27.00. Next support is seen at $25.50 and then at today’s low of $25.195. Wyckoff's Market Rating: 7.0

May N.Y. copper closed up 260 points at 407.45 cents today. Prices closed nearer the session high. The copper bulls have the firm overall near-term technical advantage. Prices are in a seven-week-old uptrend on the daily bar chart. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the March high of 416.40 cents. The next downside price objective for the bears is closing prices below solid technical support at 390.00 cents. First resistance is seen at today’s high of 409.65 cents and then at 412.50 cents. First support is seen at this week’s low of 402.50 cents and then at 400.00 cents. Wyckoff's Market Rating: 7.0.