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Gold price plummets on news of successful Covid vaccine

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(Kitco News) - Gold and silver futures prices are sharply down in early U.S. trading Monday, on the just announced news from Pfizer that it has developed a very promising Covid-19 vaccine. Stock markets soared on the news, including U.S. indexes hitting record highs, as risk appetite has up-ticked markedly the past hour. Gold prices had hit a nearly seven-week high of $1,966.10 in overnight trading. December gold futures were last down $39.90 at $1,911.70 and December Comex silver was last down $0.792 at $24.855 an ounce.

Pfizer within the past hour announced a Covid-19 vaccine trial of around 44,000 subjects that is 90% effective gave the stock markets a solid boost from earlier overnight gains. It seems this is finally the good news the global marketplace has been awaiting for months—during a grim period when the pandemic appears to be worsening in places like the U.S. and Europe.

The U.S. dollar index is near steady early today after hitting a nine-week low overnight. The other important outside market sees crude oil prices sharply higher and trading around $40.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note has risen today is currently fetching 0.8%.

The marketplace earlier was calmer to start the trading week. Joe Biden was declared the winner of the U.S. presidential election on Saturday, and it appears his margin of victory is growing by the day, as the ballot-counting continues. The marketplace still reckons control of the U.S. Congress will be split, with Democrats having the majority in the House of Representatives and the Senate tilting slightly to the Republicans—even though there is a chance the Democrats could take the Senate due to still-contested Senate seats. Stock markets tend to like gridlock and no major shifts in fiscal policy.

While the specter of more U.S. government regulation of businesses under a Biden administration is a negative for the stock market, that is being offset by notions Biden will be a more stable force on the U.S. global policy front. The Chinese yuan hit a more-than-two-year high Monday on ideas the U.S.-China relations will improve under Biden.

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

Live 24 hours gold chart [Kitco Inc.]

Technically, the December gold futures bulls still have the overall near-term technical advantage. Bulls’ next upside price objective is to produce a close in December futures above solid resistance at today’s high of $1,966.10. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the September low of $1,851.00. First resistance is seen at $1,925.00 and then at $1,939.40. First support is seen at the overnight low of $1,899.50 and then at $1,880.00. Wyckoff's Market Rating: 6.5

Live 24 hours silver chart [ Kitco Inc. ]

December silver futures bulls have the overall near-term technical advantage but prices are scoring a bearish “outside day” down on the daily bar chart today, after hitting a nearly seven-week high overnight. Silver bulls' next upside price objective is closing prices above solid technical resistance at $27.00 an ounce. The next downside price objective for the bears is closing prices below solid support at the October low of $22.625. First resistance is seen at $25.00 and then at $25.71. Next support is seen at the overnight low of $24.455 and then at $25.00. Wyckoff's Market Rating: 6.5.

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.