(Kitco News) - Gold and silver prices are lower in midday U.S. trading Monday, on a quieter news day that is allowing traders to focus more on daily outside markets, which lean bearish: a higher U.S. dollar index and lower crude oil prices. December gold was last down $12.10 at $2,664.20 and December silver was down $0.435 at $31.32.
U.S. stock indexes are higher near midday, with the S&P 500 stock index futures hitting a record high today. That’s also a negative for the precious metals amid less risk aversion and also from a competing asset class perspective.
China September economic data released Monday and over the weekend was again downbeat—a bit bearish for the metals from a demand perspective. Trade data came in weaker than expected. Consumer inflation slowed and deflation among manufacturers persisted. The September consumer price index was up 0.4%, year-on-year, while the producer price index was down 2.8% annually. China’s exports in September were up 2.4% and imports were up 0.3%--both below market expectations. The Chinese finance minister on Saturday commented on the economic stimulus plans to prop up the world’s second-largest economy but the marketplace was disappointed due to lack of specifics.
The latest CFTC Commitments of Traders report on Friday showed gold speculators again reduced their net long futures positions from a 54-month high recorded at the end of September. However, net speculative longs remain at elevated levels. “Conversely, aggregate ETF/ETC flows have turned negative over the last week, with net inflows to U.S. vehicles being more than matched by net outflows elsewhere, perhaps prompted by stale bulls taking profits on local currency gold gains,” said Frank Watson from Kinesis Money.
The key outside markets today see the U.S. dollar index higher and hitting nine-week high. Nymex crude oil prices are lower and are trading around $73.75 a barrel. OPEC has just trimmed its global oil demand outlook. The benchmark 10-year U.S. Treasury note yield is presently fetching 4.096%.
There was is no major U.S. economic data for released Monday, due in part to the Columbus Day federal holiday.
Technically, December gold bulls have the solid overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at the contract high of $2,708.70. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,600.00. First resistance is seen at today’s high of $2,684.20 and then at $2,700.00. First support is seen at $2,650.00 and then at $2,638.00. Wyckoff's Market Rating: 8.5.
December silver futures bulls have the overall near-term technical advantage. Prices are still in a nine-week-old uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at the May high of $33.50. The next downside price objective for the bears is closing prices below solid support at $30.00. First resistance is seen at today’s high of $31.75 and then at $32.00. Next support is seen at $31.00 and then at last week’s low of $30.345. Wyckoff's Market Rating: 7.0
(Hey! My “Markets Front Burner” weekly email report is my best writing and analysis, I think, because I get to look ahead at the marketplace and do some market price forecasting. Plus, I’ll throw in an educational feature to move you up the ladder of trading/investing success. And it’s free! Sign up here; it’s real easy. https://www.kitco.com/services
