RJO FuturesCast

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Metals

Dollar Weakness Places Pressure on Silver and Gold Markets

Posted 07/17/2017 11:25AM CT | Manon Lasserre

While political turmoil in Washington might downshift somewhat this week, a delay in the vote on healthcare reform could leave legislators more time to focus on the Russian election tampering issue. While August gold is tracking in positive territory this morning, it was unable to take out the Friday high in the early trades. It is possible that gold and silver are undermined slightly by favorable Chinese economic data released overnight but it is also possible that a stronger China will foster improved physical demand hopes for many commodities. Gold is undermined slightly by a positive start in the dollar but the dollar remains injured on its charts and fundamentally suspect. Expectations that the fed will delay or slow the rate of interest rate hikes should leave the dollar under pressure until there is a definitive improvement in US scheduled data. Silver derivatives holdings continue to make new all-time highs with current holdings sitting at 656 million ounces! The net spec and fund long positions in gold and silver were mostly liquidated into the recovery action at the end of last week and that might leave markets with additional buying fuel in the event the dollar continues to decline.

COMEX SILVER (SEP): Momentum studies are rising from mid-range, which could accelerate a move higher if resistance levels are penetrated. The market’s close above the 9-day moving average suggests the short-term trend remains positive. The market setup is supportive for early gains with the close over the first swing resistance. The near-term upside objective is at 16.376 and the next area of resistance is around 16.187 and 16.376, while first support hits today at 15.693 and below at 15.387.

 

Sep ’17 Silver Daily Chart

Sep '17 Silver Daily Chart

Manon Lasserre