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Gold, silver prices weaker as world stock markets rally

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(Kitco News) - Gold and silver prices are moderately down in early U.S. trading Monday, as the safe-haven metals continue to see selling pressure from bull market runs in world equities, including U.S. stock indexes that are at or near record highs. February gold futures were last down $8.60 an ounce at 1,464.00. March Comex silver prices were last down $0.131 at $16.975 an ounce.

Asian and European stock markets were mostly firmer overnight. The U.S. stock indexes are pointed toward higher openings when the New York day session begins, and are at or near their record and contract highs. Trader and investor risk appetite is upbeat to start the trading week, on some positive economic data coming out of China and on hopes for a partial U.S.-China trade deal coming soon.

For the first time in seven months factory activity in China saw expansion. The purchasing managers’ index (PMI) rose to 50.2 in November versus 49.3 in October, and was expected to come in at 49.5. A reading above 50.0 suggests growth in the sector.

Meantime, the Euro zone manufacturing PMI came in at 46.9 in November versus 45.9 in October. A reading of 46.6 was expected for November.

The upbeat manufacturing data coming out of China and the Euro zone—the number two and three economies in the world—worked to lift world equity markets and crude oil prices Monday, but put pressure on safe-haven assets gold and U.S. Treasury markets.

President Trump has just tweeted Monday morning that the U.S. will slap some more tariffs on South American countries he says are trading unfairly with the U.S.

The key “outside markets” today see the U.S. dollar index modestly up. Nymex crude oil prices are higher and trading around $56.50 a barrel.

U.S. economic data due for release Monday includes the U.S. manufacturing PMI, the ISM manufacturing report on business, construction spending, and the global manufacturing PMI.

Live 24 hours gold chart [Kitco Inc.]

Technically, the gold bears have the slight overall near-term technical advantage. Prices are in a three-month-old downtrend on the daily bar chart. Bulls’ next upside price objective is to produce a close in February futures above solid resistance at $1,500.00. Bears' next near-term downside price breakout objective is pushing futures prices below solid technical support at $1,425.00. First resistance is seen at last week’s high of $1,472.90 and then at $1,480.00. First support is seen at last week’s low of $1,456.60 and then at the November low of $1,453.10. Wyckoff's Market Rating: 4.0

Live 24 hours silver chart [ Kitco Inc. ]

March silver futures bears also have the overall near-term technical advantage. Prices are in a three-month-old downtrend on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $17.50 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $16.00. First resistance is seen at last week’s high of $17.225 and then at $17.355. Next support is seen at the November low of $16.76 and then at $16.50. Wyckoff's Market Rating: 4.0.

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