Gold and silver prices experience significant profit-taking after reaching all-time highs

Huitong Network, December 30—— On Monday (December 29) during the mid-afternoon U.S. session, gold and silver market prices plummeted, marking one of the largest single-day declines in history. Large-scale profit-taking by short-term futures traders and weak longs closing positions became the main features of today's market.

On Monday (December 29) during the mid-afternoon U.S. session, gold and silver market prices plummeted, marking one of the largest single-day declines in history. Large-scale profit-taking by short-term futures traders and weak longs closing positions became the main features of today's market.



During the overnight session, COMEX (New York Mercantile Exchange) March silver futures prices hit a historic high of $82.67/ounce; last Friday, February gold futures also set a record peak of $4,584.00/ounce. February gold futures dropped $203.4 intraday, closing at $4,349.3/ounce; March silver futures fell $6.87, settling at $71.895/ounce.

From a technical perspective, today's price drop is a corrective pullback within the current uptrend, and the overall upward trend remains intact. Although gold and silver both suffered some short-term technical damage today, the situation is not severe. However, if there is strong follow-through selling pressure in the market on Tuesday or Wednesday, it could result in more serious technical damage, which would more clearly indicate that the market may have reached a short-term top. Conversely, if gold and silver prices rebound strongly in the coming days, today's lows may become the latest "correction low" within the current uptrend. In other words, the trading performance of gold and silver over the next two days will be crucial in determining the price direction for the coming weeks.

Key external market moves today: the U.S. Dollar Index edged higher; crude oil prices rose, trading around $59.25 per barrel; the benchmark 10-year U.S. Treasury yield is currently at 4.118%.


(COMEX Gold Daily Chart Source: EasyHuitong)

From a technical analysis perspective, the next upside target for February gold futures bulls is to push contract prices above the key resistance level of $4,584.00/ounce (the all-time high); the short-term downside target for bears is to press futures prices below the critical technical support level of $4,200.00/ounce. The first resistance is at $4,400.00/ounce, with further resistance at $4,433.00/ounce; the first support is at today's low of $4,316.00/ounce, with further support at $4,300.00/ounce.

For March silver futures, today's price action formed a notable bearish "exhaustion tail," indicating that bulls lost momentum at high levels and prices fell sharply, closing near the day's lows. At the same time, today's move also formed a significant bearish "key reversal down pattern" on the daily chart. The next upside target for the bulls is to push contract prices above today's all-time high of $82.67/ounce; the next downside target for the bears is to press contract prices below the key support at $67.50/ounce. The first resistance is at $72.50/ounce, with further resistance at $73.00/ounce; the first support is at $70.00/ounce, with further support at $69.00/ounce.

Note: The gold market operates mainly through two pricing mechanisms. The first is the spot market, quoted for immediate purchase and delivery; the second is the futures market, with pricing for delivery at a specific future date. Due to year-end position adjustments and market liquidity, the December delivery contract is currently the most actively traded gold futures contract on the Chicago Mercantile Exchange (CME).