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  • Gold was down 2% in the New York session while the DXY takes on fresh highs.
  • Silver prices were down by almost 3% having travelled from a high of 17.60 to a low of 16.93.

Following a firmer Dollar and weakness in other currencies, while US stocks climb at the start of the week, precious metals have come under pressure again. Gold was down 2% in the New York session while the DXY takes on fresh highs and the highest level since 2017 trade.

“Precious metals are under pressure by the less-than-gloomy round of global data, which follows less-dovish-than-expected messaging from the Fed, and has increasingly signaled a divergence of opinions with many of the opinion that current policy may be appropriate, as the Fed attempts to pare back market expectations,” analysts at TD Securities explained.

Gold is currently trading at $1,468 and off around $29 having travelled from a high of $1,500.53 and a low of $1,464.65. Silver prices were down by almost 3% having travelled from a high of 17.60 to a low of 16.93, extending the downside from the 5th September highs made in the mid 19 handle. As for futures, December gold lost $33.50, or 2.2%, to settle at $1,472.90 an ounce losing 3.7% for the month, but gaining 3.4% for the quarter. As for Silver futures, the December contract lost 44.7 cents, or 2.5%, to trade at $17.205 an ounce, heading for a lose 6.2% for the month but up over 11% in the quarter.  

“We suspect that a disappointment from the Fed could cause an undue tightening in financial conditions, which would arguably have a more pronounced impact on equities, and therefore could see interest in gold counter-intuitively rise thereafter in response – Notwithstanding the risks, we still think the Fed is set to cut rates next month, which suggests that $1,600/oz gold could be in the cards,”

the analysts at TD Securities argued.

Gold levels

Bears completed a  50% mean reversion of the late June swing lows to recent highs around 1470 and now look to  the 19 July swing highs down at 1,452.93. On the upside, bulls will need to get back above the 1500 psychological level and then the  1535 resistance comes in again ahead of the 1,550 target which guards territories towards 1,590 as the 127.2% Fibo target.

Silver levels  

As for the white metal, bears are hunting down the 200-day moving average down at 15.80 having taken out the 50-DMA and  below the 38.2% retracement prior target of 17.50 that guarded ahead of a 50% reversion to 16.80. The  61.8% is down at 16.10.  Bulls will need to break the 17.80s higher and triple-top target of 18.60/80 which will bring in the 19.60s and September highs.