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Gold, Silver Prices Down As U.S. Dollar Index Rallies

Kitco News

(Kitco News) - Gold prices are moderately lower, while silver prices are sharply down and hit a more-than-2.5-year low in early U.S. trading Tuesday. A strong U.S. dollar on the foreign exchange market is trumping ongoing world trade tensions and wobbly secondary currency markets. December gold futures were last down $6.40 an ounce at $1,200.30. December Comex silver was last down $0.337 at $14.225 an ounce.

World stock markets were mixed to lower overnight. U.S. stock indexes are pointed toward mixed to firmer openings when the New York day session begins. Global stock markets were mostly weaker on Monday, on world trade worries after President Trump during the weekend threatened to exclude Canada from the just-concluded U.S.-Mexico trade deal.

The calendar has turned to September and after the long U.S. holiday weekend traders and investors are likely coming back to work in a more serious mood, after a summertime of fun and family vacations. The months of September and October many times find the marketplace focusing on matters of worry. The next couple of months could well find the marketplace closely examining the secondary currency markets and the beating they have taken against the U.S. dollar this year.

In overnight news, the Euro zone producer price index in July was up 0.4% from June and up 4.0%, year-on-year. Those numbers were slightly hotter than expected.

The key outside markets today find the U.S. dollar index solidly higher as the greenback continues its assault on the world’s secondary currencies. Meantime, Nymex crude oil prices are also firmly up and hit a nine-week high overnight, on worries about a hurricane in the Gulf of Mexico shutting in some U.S. crude oil production for a period of time.

U.S. economic data due for release Monday includes the U.S. manufacturing PMI, construction spending, the IDB/TIPP economic optimism index, the ISM manufacturing report on business, the global manufacturing PMI and domestic auto industry sales.

Live 24 hours gold chart [Kitco Inc.]

Technically, gold bears have the firm overall near-term technical advantage. Gold bulls' next upside near-term price breakout objective is to produce a close in December futures above solid resistance at last week’s high of $1,220.70. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the August low of $1,167.10. First resistance is seen at the overnight high of $1,209.70 and then at Friday’s high of $1,214.90. First support is seen at the overnight low of $1,197.10 and then at $1,189.50. Wyckoff's Market Rating: 2.0.

Live 24 hours silver chart [ Kitco Inc. ]

December silver futures bears have the solid overall near-term technical advantage and gained more power today. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at last week’s high of $15.07 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $14.00. First resistance is seen at $14.405 and then at today’s high of $14.59. Next support is seen at the overnight low of $14.14 and then at $14.00. Wyckoff's Market Rating: 1.0.

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