The price of gold plummets on the news of the success of the Covid vaccine

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(Kitco News) – Gold and silver futures prices fell sharply at the start of trading in the United States on Monday, on news just announced by Pfizer that it has developed a very promising Covid-19 vaccine. Equity markets shot up on the news, including US indices hitting record highs as risk appetite has increased dramatically in the past hour. Gold prices reached a nearly seven-week high of $ 1,966.10 in overnight trading. December gold futures last fell $ 39.90 to $ 1,911.70 and December Comex silver fell $ 0.792 to $ 24,855 an ounce.

Pfizer in the past hour announced a Covid-19 vaccine trial on some 44,000 subjects that is 90% effective has given stock markets a solid boost from previous overnight gains. It appears that this is finally the good news the global market has been waiting for for months, during a gloomy time when the pandemic seems to be getting worse in places like the United States and Europe.

The US dollar index is almost stable earlier today after hitting a nine-week low overnight. The other important external market sees crude oil prices significantly higher and trading around $ 40.00 per barrel. The yield on the benchmark 10-year US Treasury note increased today and currently stands at 0.8%.

The market was previously calmer to start the trading week. Joe Biden was declared the winner of the US presidential election on Saturday and it seems his margin of victory is growing by the day as the vote count continues. The market still believes that control of the US Congress will be divided, with Democrats having a majority in the House of Representatives and the Senate leaning slightly towards Republicans, although there is a possibility that Democrats could take the lead. Senate due to the Senate still disputed seating. Equity markets tend to like traffic jams and no major changes in fiscal policy.

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

US economic data due to be released on Monday is light and includes the employment trends index.

Technically, the December gold futures bulls still have the overall short-term technical advantage. The bulls next bullish price target is to close December futures above the solid resistance at today’s high of $ 1,966.10. Bears’ next short-term bearish price target is pushing futures prices below solid technical support at the September low of $ 1,851.00. The first resistance was seen at $ 1,925.00 and then $ 1,939.40. First support is seen at the overnight low of $ 1,899.50 and then $ 1,880.00. Wyckoff’s market rating: 6.5

The December silver futures bulls have the general technical advantage in the short term, but today prices are marking a bearish “day outside” on the daily bar chart, having reached a high of nearly seven weeks overnight. The next bullish price target for silver bulls is to close prices above the solid technical resistance at $ 27.00 an ounce. The next downside price target for the bears is to close prices below the solid support at the October low of $ 22.625. The first resistance was seen at $ 25.00 and then at $ 25.71. The next support is seen at the overnight low of $ 24.455 and then at $ 25.00. Wyckoff’s market rating: 6.5.