Gold, silver down on technical selling, bearish outside market elements

Gold and silver prices are lower in midday U.S. trading Wednesday and feeling the heat of recently bearish outside markets that include rising U.S. bond yields and a strong U.S. dollar index. Lower crude oil prices today added to the bearish cocktail for the metals. The near-term technical postures for gold and silver have turned more bearish recently, which is also inviting the shorter-term chart-based sellers. December gold was last down $11.30 at $1,674.70 and December silver was down $0.627 at $18.865.

Today’s U.S. producer price index report for September came in a bit hotter than expected at up 0.4% from August and up 8.5%, year-on-year. The metals markets showed no major reactions to the PPI report. The U.S. consumer price index on Thursday morning is expected to come in at up 8.1%, year-on-year, following a rise of 8.3% in August.

U.S. stock indexes are a bit firmer at midday, on short covering. The marketplace remains less than “risk-on” at mid-week, following a downbeat assessment of the global economy by the International Monetary Fund on Tuesday.

The U.K. government bond market is still in turmoil, as the Bank of England this week was forced to buy inflation-linked bonds as part of its bond-buying program. The BOE today reiterated it will shut down its bond-buying program on Friday. There are worries U.K. pension funds could be lost if the U.K. bond market rout continues.

The key outside markets today see the U.S. dollar index slightly higher. Nymex crude oil prices are lower and trading around $86.50 a barrel. The U.S. Treasury 10-year note yield is presently fetching 3.917%.

Technically, the gold futures bears have the solid overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at the October high of $1,738.70. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the September low of $1,622.20. First resistance is seen at Tuesday’s high of $1,691.30 and then at $1,700.00. First support is seen at this week’s low of $1,667.50 and then at $1,650.00. Wyckoff’s Market Rating: 2.5

The silver bears have the solid overall near-term technical advantage. Silver bulls’ next upside price objective is closing prices above solid technical resistance at $20.00. The next downside price objective for the bears is closing prices below solid support at $18.00. First resistance is seen at today’s high of $19.31 and then at Tuesday’s high of $19.725. Next support is seen at $18.50 and then at $18.00. Wyckoff’s Market Rating: 2.5.

December N.Y. copper closed down 440 points at 341.80 cents today. Prices closed nearer the session low today. The copper bears have the overall near-term technical advantage. Copper bulls’ next upside price objective is pushing and closing prices above solid technical resistance at the September high of 369.25 cents. The next downside price objective for the bears is closing prices below solid technical support at the July low of 315.55 cents. First resistance is seen at this week’s high of 347.70 cents and then at 350.00 cents. First support is seen at last week’s low of 335.20 cents and then at the September low of 324.30 cents. Wyckoff’s Market Rating: 3.0.