The negative price action in gold, silver, after Monday’s madness

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(Kitco News) – Gold and silver futures prices traded sharply lower in early US trading, with silver taking the lead. It seems that the attempt to push short in the silver market, at least at this stage, has failed. Gathering global stock markets early this week is a clumsy element for safe haven metals. Gold futures in April last fell $ 19.70 lower at $ 1,844.00 and Comex silver last March $ 1,718 lower at $ 27.72 ounces.

Silver’s big setback from the eight-year high of $ 30.35 in March indicated silver futures contracts that retailers’ attempts to deliver a short press have failed – at least for now. The big jump in silver futures contracts is attracting the attention of the Commodity Futures Trading Commission (CFTC), with acting chairman Rostin Behnam having the futures regulator closely monitor activity. “The Commission is communicating with co – regulators, the exchanges and stakeholders to address potential threats to the integrity of the derivatives markets for silver and remains vigilant in investigating these markets for fraud and manipulation,” he said. The Comex did increase trading margins on silver futures this week.

Global stock markets were mostly firmer overnight. US stock indices point to higher openings when the day starts in New York, and have recovered strongly after the recent declines. Traders and investors were excited this week about the news that the Covid-19 pandemic, although still gripping many countries, is showing some signs of peaking in the US and Europe as vaccines continue to spread among the population , but not without serious bottlenecks. The market’s attention is also on a new pandemic relief package that is likely to pass through the US Congress in the coming weeks. It also appears that the trading saga of GameStop and ‘Redditor’ is dead at least for now, as the market once again focuses on corporate earnings reports and upcoming economic data that includes Friday’s U.S. employment report.

In other overnight news, the eurozone economy shrank by 0.7% in the fourth quarter and by 5.1% year-on-year. However, the numbers were just a little better than expected.

The major “outside markets” today show that the US dollar index is higher, reaching a seven-week high overnight. What is important is that the USDX is now higher on a short-term basis and that some of the major currency futures markets are now in the short-term downward trend in the short term, while others are at least seeing their price increases decline. Meanwhile, Nymex futures crude oil prices rose sharply, peaking at more than 12 months overnight and trading around $ 55.00 a barrel. The yield on the standard 10-year US Treasury note is 1.10%.

U.S. economic data to be released Tuesday includes the weekly reports on retail sales of Goldman Sachs and Johnson Redbook, the ISM New York report, the IDB / TIPP index for economic optimism and local sales in the automotive industry.

Technically, the gold futures bulls and bears in February are back at an equal level of technical advantage in the short term, amid the recent bad trade. The Bulls’ next upward price target is to end in February futures with a solid resistance at $ 1,900.00. Bears’ next short-term downward price target pushes futures prices below solid technical support at the January low of $ 1,804.70. First resistance is seen at the overnight high of $ 1,866.30 and then at the high of last week at $ 1,788.90. The first support is seen in the overnight low of $ 1,840.00 and then at the low of $ 1,832.40 last week. Wyckoff’s Market Rating: 5.0

Silver futures bulls in March have the overall technical advantage in the short term, but may now be depleted in the short term. The next upward price target for Silver Bulls is closing prices above solid technical resistance at this week’s high of $ 30.35 per ounce. The next downward price target for the Bears is to close prices below a solid support at $ 26.00. The first resistance is seen at $ 28.00 and then at $ 28.50. The next support is seen at the overnight low of $ 27.28 and then at $ 27.00. Wyckoff’s Market Rating: 7.0.