Strong USDX, rising U.S. Treasury yields, stingy Fed punish gold, silver prices
Gold and silver prices are sharply lower near midday Monday. The safe-haven metals are being hit hard by a higher U.S. dollar index, rising U.S. Treasury yields and weaker crude oil prices to start the trading week. An aggressively tight monetary policy from the U.S. Federal Reserve is also serving as an anchor on the precious metals markets. December gold was last down $34.30 at $1,675.00 and December silver was down $0.61 at $19.645.
Global stock markets were mostly lower overnight. U.S. stock indexes are weaker at midday. U.S. government offices and many banks are closed Monday for the Columbus Day national holiday. Stock market traders will focus on a barrage of corporate earnings reports out this week.
Risk aversion is still elevated. The Russia-Ukraine war has escalated as Russia launched missiles into several Ukrainian cities after a strategic bridge for Russia in the Crimea region suffered major damage from explosions, with Ukraine’s military likely the culprit. Meantime, North Korea has test-fired ballistic missiles to provoke the West in an already-tense global geopolitical environment.
The short-squeeze won't last, silver price to end the year lower warns Metals Focus
The key outside markets today see the U.S. dollar index solidly higher. Nymex crude oil prices are weaker and trading around $92.00 a barrel. The U.S. Treasury 10-year not yield is presently fetching 3.9%.
Traders are looking ahead to key U.S. inflation reports on Wednesday and Thursday. The producer price index for September is out Wednesday morning. The consumer price index report for September is out Thursday, which is expected to come in at up 8.1%, year-on-year, following a rise of 8.3% in August.
Technically, the gold futures bears have the solid overall near-term technical advantage and gained fresh power on momentum today. Bulls’ next upside price objective is to produce a close above solid resistance at the October high of $1,738.70. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the September low of $1,622.20. First resistance is seen at $1,700.00 and then at today’s high of $1,707.40. First support is seen at $1,662.00 and then at $1,650.00. Wyckoff's Market Rating: 2.0
The silver bears have the slight overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at the October high of $21.31. The next downside price objective for the bears is closing prices below solid support at $18.00. First resistance is seen at $20.00 and then at today’s high of $20.21. Next support is seen at $19.25 and then at $19.00. Wyckoff's Market Rating: 4.5.
December N.Y. copper closed up 560 points at 344.35 cents today. Prices closed nearer the session high today. The copper bears have the overall near-term technical advantage. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the September high of 369.25 cents. The next downside price objective for the bears is closing prices below solid technical support at the July low of 315.55 cents. First resistance is seen at 350.00 cents and then at the September high of 359.30 cents. First support is seen at last week’s low of 335.20 cents and then at the September low of 324.30 cents. Wyckoff's Market Rating: 3.0.
By Jim Wyckoff
For Kitco News
Time to buy Gold and Silver on the dips
David