Gold and Silver Lower Amid Weak China Economic News and Bearish External Markets

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(Kitco News) – Gold and silver prices are markedly lower Monday at midday in the United States, on concerns about demand for the metals after a series of weak economic data from China. Sharply lower crude oil prices and a stronger US dollar index to start the trading week are also daily bearish forces working against the metals. October gold futures last fell $19.60 to $1,785.70. September Comex silver futures were last down $0.443 at $20.26 an ounce.

China’s central bank unexpectedly announced this week that it was cutting interest rates and adding liquidity to China’s financial system after the release of grim economic data for the world’s second-largest economy. Chinese data on industrial production, investment, consumer spending and real estate all weakened in July. Bad news from China added to fears of a global economic recession. Covid restrictions and a struggling real estate market have helped hamper the Chinese economy in recent months. On Monday, prices for other commodities were also hit by Chinese news, driven by a sharp drop in crude oil prices. China is a major global consumer of raw materials, including metals. A weakening Chinese economy suggests lower demand for commodities.

Global equity markets were mixed overnight. US stock indices are a bit higher at midday.



Major outside markets are seeing Nymex crude oil prices drop sharply today and trading around $88.50 a barrel. The US Dollar Index is solidly higher at midday in the United States. The yield on the 10-year US Treasury bond reached 2.781%.

Technically, October gold futures have the overall short-term technical advantage. An incipient upward price trend is now barely in place on the daily bar chart. The Bulls’ next upside price objective is to produce a close above strong resistance at the August high of $1,814.40. Bears next short-term downside price objective is to push futures prices below strong technical support at $1,725.00. First resistance is seen at $1,800.00 and then at today’s high of 1,808.20. First support is seen at today’s low of $1,777.60 and then at $1,760.00. Wyckoff Market Rating: 3.5.

24 hour live money chart [ Kitco Inc. ]

September silver futures have the overall short-term technical advantage. An incipient uptrend on the daily bar chart has come to a halt. The next upside price objective for the silver bulls is to close prices above the strong technical resistance at $22.00. The next downside price objective for the bears is to close prices below the strong support at $19.00. First resistance is seen at $20.50 and then at today’s high of $20.87. The next support is seen at $20.00 and then at $19.47. Wyckoff Market Rating: 3.5.

September copper in New York closed 525 points at 361.60 cents today. Prices closed near the mid-range. Major “outside markets” were bearish for copper today as crude oil prices fell sharply and the US dollar index was higher. Copper bulls and bears are in an overall short-term technical playing field. Prices tend to rise on the daily bar chart. The next upside price objective of the copper bulls is to push and close prices above strong technical resistance at 385.00 cents. The next downside price target for the bears is for prices to close below strong technical support at 330.00 cents. First resistance is seen at last week’s high at 371.30 cents, then at 380.00 cents. First support is seen at today’s low of 354.60 cents then 350.00 cents. Wyckoff Market Rating: 5.0.

Disclaimer: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. This is not a solicitation to trade commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for loss and/or damage resulting from the use of this publication.

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