Surging U.S. Dollar Sinks Gold, Silver Prices

(Kitco News) - Gold prices ended the U.S. day session down and hit a six-week low Monday. Silver prices were just slightly lower but dropped to a seven-week low early on today. The appreciating U.S. dollar on the foreign exchange market and little risk aversion in the marketplace at present are bearish elements for the gold and silver markets. December Comex gold was last down $8.10 an ounce at $1,276.60. December Comex silver prices were last down $0.011 at $16.665 an ounce.

It was a very somber mood among U.S. traders and investors Monday. A shooting spree in Las Vegas late Sunday that left over 50 people dead and over 500 wounded was the worst shooting spree in modern U.S. history. The attack is not believed to be a terrorist event and did not impact the markets.

World stock markets were mostly firmer Monday. U.S. stock indexes were mixed in early afternoon trading. The S&P 500 index scored another record high Monday, to accentuate the upbeat trader/investor risk attitudes at present.

The war of words between the U.S. and North Korea flared up again over the weekend. After the U.S. Secretary of State Rex Tillerson suggested there is some dialogue taking place with North Korea regarding its nuclear missiles, President Trump then tweeted “save your energy Rex.” So far, the world markets are not reacting strongly to the weekend developments on the geopolitical front.

In other overnight news, the Spanish referendum on Catalonia splitting from Spain passed easily. This put more downside pressure on the Euro currency.

The U.S. dollar index was solidly higher and hit a six-week high Monday. Greenback bulls have momentum. A couple of upbeat U.S. economic reports Monday helped pushed the U.S. currency still higher on the day.

The other key outside market on Monday saw Nymex crude oil futures solidly lower. Profit taking was seen after prices last week hit a five-month high. While the oil bulls still have the overall near-term technical advantage, there are stiff chart resistance layers just above present price levels.

Technically, December gold futures prices closed near mid-range today. Bears have the overall near-term technical advantage. A steep three-week-old downtrend is in place on the daily bar chart. Gold bulls' next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,300.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at $1,250.00. First resistance is seen at today’s high of $1,282.80 and then at $1,290.00. First support is seen at today’s low of $1,273.70 and then at $1,270.00. Wyckoff's Market Rating: 4.0

December silver futures prices closed near mid-range and hit a seven-week low today. The silver bears have the overall near-term technical advantage. Prices are in a three-week-old downtrend on the daily bar chart. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at last week’s high of $17.295 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $16.00. First resistance is seen at $16.90 and then at $17.00. Next support is seen at today’s low of $16.565 and then at $16.50. Wyckoff's Market Rating: 4.0.

December N.Y. copper closed down 5 points at 296.45 cents today. Prices closed nearer the session low today. The copper bulls have the overall near-term technical advantage, but trading has been choppy recently. Copper bulls' next upside price objective is pushing and closing prices above solid technical resistance at the September high of 317.85 cents. The next downside price objective for the bears is closing prices below solid technical support at 280.00 cents. First resistance is seen at 300.00 cents and then at 302.50 cents. First support is seen at today’s low of 293.75 cents and then at 292.50 cents. Wyckoff's Market Rating: 6.0.