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Gold, Silver Prices Down Despite Some Risk Aversion

Kitco News

(Kitco News) - Gold and silver prices are solidly lower in early U.S. trading Monday, and have extended overnight losses. The safe-haven metals are not getting any benefit from an uptick in risk aversion to start the trading week. Instead, both are being pressured by a strong U.S. dollar on the foreign exchange market. December gold futures were last down $12.30 an ounce at $1,193.40. December Comex silver was last down $0.194 at $14.455 an ounce.

World stock markets were mostly lower overnight, with steep losses seen in the Chinese stock market after it was closed last week for a public holiday. Chinese monetary officials during the weekend loosened monetary policy a bit more but that did not stop their stock market sell off. U.S. stock indexes are pointed toward weaker openings then the New York day session begins. The U.S. government, including the Treasury bond cash market, is closed for the Columbus Day holiday today. Canadian markets are shut for the Thanksgiving holiday.

World equities are still pressured by rising government bond yields that are pulling investor interest away from stocks. U.S. stock indexes are in very mature bull market runs that have many wondering if the end is near. 

Risk-off attitudes to start the trading week are also being perpetuated by the new Italian anti-establishment government not falling into line with European Union rules on a budget.

The key outside markets today find the U.S. dollar index higher, on safe-haven demand. Meantime, November Nymex crude oil prices are lower on profit taking and trading around $73.50 a barrel.

U.S. economic data due for release Monday is light and includes the employment trends index.

Live 24 hours gold chart [Kitco Inc.]

Technically, gold bears have the 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 $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 $1,200.00 and then at the overnight high of $1,208.00. First support is seen at the September low of $1,184.30 and then at $1,175.00. Wyckoff's Market Rating: 2.5

Live 24 hours silver chart [ Kitco Inc. ]

December silver futures bears have the overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $15.00 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the September low of $13.965. First resistance is seen at the overnight high of $14.70 and then at last week’s high of $14.95. Next support is seen at last week’s low of $14.395 and then at $14.25. Wyckoff's Market Rating: 2.5.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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