Gold, silver feel the bite of bearish outside markets Monday
(Kitco News) - Gold and silver prices are are lower near midday U.S. trading Monday, with silver prices hitting a three-month low. Bearish daily postures for the key outside markets have the metals bulls standing aside to start the trading week, as crude oil prices are sharply lower and the U.S. dollar index is firmer. August gold futures were last down $9.50 at $1,805.70 and September Comex silver was last down $0.59 at $25.20 an ounce.
Raw commodity sector leader crude oil prices are sharply lower, hit a five-week low and are trading around $67.00 a barrel. A surprising OPEC-plus meeting Sunday saw the cartel agree to raise its collective crude oil production by around 400,000 barrels a day each month through the end of 2022, reports said. If crude oil prices have indeed peaked out, that's a negative element for the entire raw commodity sector, including the metals. Meantime, the U.S. dollar index hit a 3.5-month high overnight as the index continues in a near-term price uptrend.
U.S. bond yields are on the decline on some safe-haven buying as the global stock markets have come a bit wobbly. The 10-year U.S. Treasury note yield is presently fetching 1.255%.
Global stock markets mostly lower overnight. The U.S. stock indexes are lower at midday. It is beginning to appear trader and investor enthusiasm may be losing some momentum at mid-summer, as the newer Covid-19 strain is surging in some regions of the world, including the U.S. Concerns about a slowing global economy combined with rising inflation may bring back into the business lexicon the term “stagflation.” That word emerged in the late 1970s amid double-digit inflation and a sputtering U.S. economy.
Technically, gold futures bulls have the overall near-term technical advantage and have restarted a price uptrend on the daily bar chart. However, they need to show fresh power early this week to keep the uptrend alive. Bulls' next upside price objective is to produce a close above solid resistance at $1,850.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,775.00. First resistance is seen at the overnight high of $1,818.00 and then at $1,825.00. First support is seen at today's low of $1,795.00 and then at $1,791.00. Wyckoff's Market Rating: 6.0
The silver bears have regained the overall near-term technical advantage. Silver bulls' next upside price objective is closing September futures prices above solid technical resistance at the July high of $26.91 an ounce. The next downside price objective for the bears is closing prices below solid support at the March low of $23.825. First resistance is seen at $25.50 and then at the overnight high of $25.805. Next support is seen at $25.00 and then at $24.75. Wyckoff's Market Rating: 4.0.