Buying in cryptocurrency is putting pressure on precious metals: Tradebulls

 

Both silver and gold are headed to basement after strong US and Europe's economic data.

Gold market has broken down significantly since last week as the US Dollar had gathered steam and smooth White House transition. Vaccine news is also putting prices under pressure. Gold is near to its support area around $1800 (also its 200 day SMA) and previously it was that area from where it broke resistance and made new high. There is plently of support around that level but if bears manage to break below this mark, then we may see correction more to the tune of $50. Strong US and Europe's data also pushed gold prices lower. We are waiting for some candlestick pattern showing reversal sign on the chart. We should pay attention to the US Dollar Index, because if it starts to rise that could be very bad news for gold in general. While a lack of data/events may push the gold traders towards risk news, updates from the US and concerning the vaccine may get major attention. We might see some pullback as RSI is in oversold on daily chart.

Investors are shifting to cryptocurrency and so precious metals are falling. Both silver and gold headed to basement after strong US and Europe's economic data. Looking at the 6-month chart, the precious metal is currently trading below the 50-day and 100-day exponential moving averages. However, the outlook for the silver price movement is rather neutral to bearish. On daily chart, RSI still is not in oversold region so there is room for downside. In MCX, major support for silver comes at 60,200 while resistance comes at 62,000. Any dips around 60,200 would be good level for going long in silver.

We have seen breakout on daily chart in Crude oil. WTI breakout was above $43.60 which it has successfully breached. Positive vaccine development along with material improvement in the physical oil market have pushed the prices. Increased buying from China has considerably tightened the physical oil market. Despite the recent oil price rally, money manager positioning remains near the lows so there is more chances of oil going higher as long positions will be made. Annual surplus has narrowed to just +2.3 MMbbls (from +101 MMbbl in July), while the surplus relative to 5-year average has narrowed to +9.3 MMbbls (from +95 MMbbl in July)