(Kitco News) - Gold and silver prices are posting strong losses in early U.S. trading Friday, as very high daily price volatility continues, which is not bullish. Also, December gold and silver markets have this week seen bear flag patterns form on their daily bar charts. Risk appetite is better this week, as the U.S. stock indexes are just below their record highs. That’ also bearish for the safe-haven metals. December gold was last down $73.00 at $4,072.00. December silver prices were down $1.034 at $47.665.
Gold prices are also poised to their end nine-week winning streak. Prices are pressured by heavy selling after repeatedly hitting record highs in recent weeks. The metal dropped more than 5% early in the week, marking its largest intraday loss in years. The decline coincided with significant withdrawals from gold-backed ETFs, which saw their largest single-day drop in holdings by tonnage in five months. Still, gold remains up about 55% year-to-date, with underlying support coming from ongoing trade tensions. Geopolitical risks also persist after the U.S. imposed new sanctions on Russia in an attempt to pressure Moscow for a Ukraine ceasefire.
Global stock markets were mixed overnight. U.S. stock indexes are pointed higher openings when the New York day session begins.
U.S. consumer price index on deck this morning. The marketplace today gets its first piece of major U.S. government economic data in three weeks: the consumer price index report for September. CPI is seen coming in at up 3.1%, year-on-year, compared to the August report that showed a 2.9% annual rise. The core CPI (excluding food and energy) is seen coming in at up 3.1% in September, annually, which would be unchanged from the August core reading. The marketplace generally believes even a hotter-than-expected CPI print today would not dissuade the Federal Reserve from cutting U.S. interest rates by 0.25% at next week’s FOMC meeting.
In other overnight news, Trump terminates trade talks with Canada over negative U.S. tariffs ad. President Trump said on Truth Social late Thursday he would immediately halt all trade negotiations with Canada, citing a Canadian advertisement against his signature tariffs plan featuring the voice of former President Ronald Reagan. The ad, funded by the government of Ontario, uses excerpts from an address Reagan gave in 1987 in which he defended the principles of free trade and slammed tariffs as an outdated idea. Trump's announcement injected fresh uncertainty into one of the world's largest bilateral trading relationships, with the U.S. and Canada exchanging more than $900 billion in goods and services last year. “TARIFFS ARE VERY IMPORTANT TO THE NATIONAL SECURITY, AND ECONOMY, OF THE U.S.A.,” Trump wrote. “Based on their egregious behavior, ALL TRADE NEGOTIATIONS WITH CANADA ARE HEREBY TERMINATED.” Funded by the government of Ontario, the ad seeks to sow doubt among Republican voters by using one of the party’s most iconic voices, reported Bloomberg.
China trade officials upbeat on reaching trade deal with United States… China’s Commerce Minister struck an optimistic tone on talks with the U.S., saying Beijing and Washington can find solutions ahead of key trade negotiations between the two countries. “The economic and trade consultations between China and the U.S. fully demonstrate that based on mutual respect and equal consultation, China and the U.S. can find solutions to address each other’s concerns,” Commerce Minister Wang Wentao said during a briefing on China’s next five-year plan and as reported by Bloomberg. Wang also reiterated that China opposed decoupling and disrupting supply chains. Chinese Vice Premier He Lifeng — the country’s top trade negotiator — is scheduled to meet with U.S. officials including U.S. Treasury Secretary Scott Bessent in Kuala Lumpur today through Monday for the next round of trade talks. They are setting the stage for scheduled talks between Chinese President Xi Jinping and President Trump next Thursday on the sidelines of the Asia-Pacific Economic Cooperation leaders summit in South Korea.
China to seek high-quality economic growth… China will seek to maintain a certain rate of growth and expand consumption’s share of the economy as authorities draft the next five-year development blueprint, a senior official said and as reported by Bloomberg. The aim is to achieve high-quality growth where the expansion is kept within a “reasonable range” and the share of household consumption “rises significantly,” Han Wenxiu, deputy director in charge of daily work at the Office of the Central Financial and Economic Affairs Commission, said at a briefing Friday. The briefing followed a four-day conclave of ruling Communist Party’s elites to approve the outlines for drafting China’s economic plan for the 2026-2030 period. Beijing is signaling a determination to deepen its manufacturing and tech push as it looks to maintain competitive advantages. Boosting the domestic market has become also more urgent to maintain sustainable growth amid rising global trade protectionism.
The key outside markets today see the U.S. dollar index slightly firmer. Crude oil prices are slightly up and trading around $62.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.00%.
Note: The gold market operates through two primary pricing mechanisms. The first is the spot market, which quotes prices for on-the-spot purchase and immediate delivery. The second is the futures market, which sets prices for delivery at a future date. Due to year-end positioning market liquidity, the December gold futures contract is currently the most actively traded on the CME.
Technically, December gold futures bulls have the overall near-term technical advantage. However, a minor bear flag pattern has formed on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $4,250.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,000.00. First resistance is seen at the overnight high of $4,159.00 and then at Wednesday’s high of $4,175.00. First support is seen at the overnight low of $4,066.70 and then at this week’s low of $4,021.20. Wyckoff's Market Rating: 6.0.
The silver market bulls have the overall near-term technical advantage. However, a minor bear flag pattern has formed on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $50.00. The next downside price objective for the bears is closing prices below solid support at $45.00. First resistance is seen at the overnight high of $48.76 and then at $49.00. Next support is seen at this week’s low of $46.82 and then at $46.00. Wyckoff's Market Rating: 6.0
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