Gold and silver see horrific price pressure despite keener risk aversion

London (Sept 21)  Gold and silver prices are solidly lower in the early U.S. trading Monday. The safe-haven metals are so far not catching any bid amid a global stock market sell off to start the trading week. October gold futures were last down $23.60 at $1,929.60 and December Comex silver was last down $0.694 at $26.435 an ounce.

Global stock markets were lower overnight, with U.S. stock indexes also set to open the New York day session with solid losses. Risk aversion is back in the marketplace to start the trading week, due to several matters. The death of U.S. Supreme Court justice Ruth Bader Ginsburg has thrown the U.S. Congress into turmoil regarding when a new justice will be voted upon. The intense debate and focus regarding such has apparently pushed a new U.S. economic stimulus package to the back burner. A significant rise in Covid-19 cases in Europe, and especially the U.K., has many thinking the Euro Zone could see many businesses go on lockdown again amid a “second wave” of infections. And, throw in rising U.S.-China trade and political tensions to make traders and investors even more anxious. Remember that this is the time of year when stock and financial markets can become more volatile. The U.S. stock indexes are having their worst month since March.

The important outside markets today see the U.S. dollar index solidly higher. Nymex crude oil prices are lower trading around $40.00. These two key markets are in bearish daily postures for the metals markets. Meantime, the yield on the U.S. Treasury 10-year note is trading around 0.67% today.

U.S. economic data due for release Monday is light and includes the Chicago Fed national activity index.

Technically, the gold bulls have the firm overall near-term technical advantage but trading remains sideways. Prices are still in an overall near-term uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close in October futures above solid resistance at the September high of $1,992.50. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,900.00. First resistance is seen at the overnight high of $1,954.10 and then at $1,960.00. First support is seen at the overnight low of $1,923.10 and then at the September low of $1,904.60.

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