September 30, 2019 – Gold and silver prices finished a volatile week of trading and ended lower on Friday, only to head lower again this morning.

The equity markets also bounced up and down last week and closed lower overall. The launch of a presidential impeachment inquiry by the U.S. House of Representatives is unsettling the markets. Thus far, however, it appears Democrats have very little prospect of ultimate success so the impact is muted.

The metals have been struggling in the face of a stronger dollar. Renewed optimism over a trade deal with China may also have discouraged some safe-haven buying.

Perhaps the biggest headwind for gold and silver, however, has been the extraordinarily high number of open contracts in the futures markets.

Speculators flooded into futures chasing prices higher and the bullion banks were there selling paper contracts to all comers. The banks wound up heavily short, and when that happens, it is very often bad news for anyone betting long.

Silver and gold managed to hold important technical support levels at Friday’s close, but they have broken below those levels today.



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