The price of gold falls to a low of 5.5 months between risk attitudes

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(Kitco News) – Gold futures prices have fallen sharply and hit a 5.5-month low at the start of US trading on Monday. Silver fell to a nine-week low. Traders and investors have been showing little risk aversion recently, in the absence of geopolitical hotspots at the moment, hopes of Covid-19 vaccine, and a seemingly smoother transition of US presidential duties seen. It’s all bearish for safe haven metals. February gold futures last fell $ 17.50 to $ 1,770.30 and March Comex silver fell $ 0.499 to $ 22.14 an ounce.

Global equity markets were mixed overnight. US stock indices are also pointing towards mixed openings when the New York day session begins. In recent days, there have been reports that a Covid-19 vaccine will be on the market, to some extent, by the end of this year, which is much sooner than expected. However, on this last trading day of the month, the excitement of traders and investors has somewhat dented reports that the outgoing Trump administration will further sanction major Chinese companies in the coming weeks.

Copper prices in Shanghai peaked for more than eight years on Monday, while prices in London hit their highest for more than four years. China’s strong economic recovery continues, with the latest data showing the November Manufacturing Purchasing Managers (PMI) index at 52.1 versus October’s 51.4 and expected 51.5. The non-manufacturing PMI stood at 56.4 in November compared to 56.2 last month and 56.0 forecast. The official manufacturing PMI reading was the highest since September 2017, while the mon manufacturing PMI was the highest reading since June 2012. A Chinese copper producer is speculated who may have forwarded copper at lower price levels and now “short squeeze” situation is captured.

The US dollar index is lower and today hit a low of 2.5 years. The other major external market sees weaker January Nymex crude futures prices trading around $ 44.75 a barrel. There is an OPEC meeting that starts on Monday and will be closely followed by the market. The yield on benchmark 10-year US Treasury futures is currently trading at 0.85%.

US economic data due out Monday includes the Chicago ISM Business Survey, Pending Home Sales, and the Texas Manufacturing Survey.

Technically, February gold futures have the general short-term technical advantage. Prices are in a sharp three-week low on the daily bar chart. Bulls’ next bullish price target is to close December futures above the solid resistance at $ 1,860.00. Bears’ next short-term bearish price target is pushing futures prices below solid technical support at $ 1,700.00. The first resistance was seen at the overnight high of $ 1,793.30 and then at $ 1,800.00. First support is seen at the overnight low of $ 1,767.20 and then to $ 1,750.00. Wyckoff’s market rating: 4.0

March silver futures bears have the slight overall technical advantage in the short term as prices are now down. The next bullish price target for silver bulls is to close prices above the solid technical resistance at $ 24.00 an ounce. The next downside price target for the bears is to close prices below the solid support at the September low of $ 21.93. The first resistance was seen at the overnight high of $ 22.83 and then at $ 23.00. Next support is seen at $ 21.93 and then $ 21.50. Wyckoff’s market rating: 4.5.