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Price pressure on gold, silver as safe-haven demand wanes

Kitco News

(Kitco News) - Gold and silver futures prices are moderately lower in early U.S. trading Wednesday. The metals are seeing some selling pressure from upbeat trader/investor risk appetite, evidenced by the rallies in global stock indexes at mid-week. A higher U.S. dollar index on this day is also a negative for the metals. December gold futures were last down $6.00 at $1,870.00 and December Comex silver was last down $0.277 at $24.18 an ounce.

Global stock markets were mixed but mostly up overnight, while U.S. stock indexes are higher ahead of the New York day session. Monday’s news that Pfizer has produced a successful vaccine for Covid-19 has been followed by other firms saying they are also close to doing so. Russia has now also come out and claimed it has a vaccine that is 92% effective. The marketplace at mid-week is dealing with notions that as soon as the latter half of 2021, economies and humans’ way of life could be almost back to normal. But in the meantime, the coronavirus is rampant in the U.S., Europe and elsewhere. Many states in the U.S. are reporting hospitals are full—and it’s not even winter yet, when conditions are expected to be worse. The spike highs in the U.S. stock indexes Monday, on the initial euphoria surrounding a successful vaccine, could well be market tops that won’t get taken out any time soon.

U.S. Treasury bond and note yields have risen to eight-month highs this week, on the prospects for a solid U.S. economic recovery in 2021. The yield on the benchmark 10-year U.S. Treasury note futures is currently fetching 0.96%. The U.S. government and U.S. Treasury market are closed Wednesday for the Veterans Day holiday.

The U.S. dollar index is higher early today on a corrective bounce after hitting a nine-week low Monday. The other important outside market sees crude oil prices higher, hitting a nine-week high, and trading around $42.75 a barrel.

U.S. economic data due for release Wednesday is light and includes the weekly MBA mortgage applications survey. The U.S. government is closed today for Veterans Day.

Live 24 hours gold chart [Kitco Inc.]

Technically, the December gold futures bulls still have the overall near-term technical advantage but are fading this week. Bulls’ next upside price objective is to produce a close in December futures above solid resistance at this week’s high of $1,966.10. Bears' next near-term downside price objective is pushing futures prices below solid technical support at Monday’s low of $1,848.00. First resistance is seen at Tuesday’s high of $1,888.90 and then at $1,900.00. First support is seen at Tuesday’s low of $1,858.90 and then at $1,848.00. Wyckoff's Market Rating: 6.0

Live 24 hours silver chart [ Kitco Inc. ]

December silver futures bulls have the overall near-term technical advantage but have faded this week. 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 Tuesday’s high of $24.49 and then at $25.00. Next support is seen at Tuesday’s low of $23.95 and then at this week’s low of $23.60. Wyckoff's Market Rating: 6.0.

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.