Daily summary: Precious metals under pressure as dollar strengthens

• European indices rebound
• Macro data from the US supports the dollar
• Gold and silver plunges

European indices finished today’s session higher. Travel-related stocks did well, with Ryanair raising its long-term mobility forecast that may have contributed to the improved sentiment. As a result, the vast majority of indices ended the day in positive territory. The DAX increased by 0.23%, while the Spanish IBEX 35 and the Italian FTSE MIB gained 1.14% and 0.78% respectively.

Worse sentiment prevails on Wall Street, where the three main indices are trading in red. Fresh data showed retail sales unexpectedly increased in August, but July's reading was revised to show a 1.8% decline. Also, initial jobless claims increased slightly more than anticipated. However, looking at the latest data, it can be noticed that the US economy is doing quite well despite the spreading delta variant.

The US dollar gained significantly after publication of today’s data pack. The EURUSD pair fell by 0.50% and is testing ​​1.1755 level. US Treasury yields are also rising - market reaction suggests that investors are taking into consideration early introduction of the tapering process. A stronger dollar and rising yields are not supporting precious metals. The prices of gold bullion dropped by more than 2%, while silver prices fell over 4%. Crude oil prices slightly extend yesterday's gains. Copper prices, however, have sunk, after China said it will release additional metal reserves due to high prices. It is also worth mentioning about the Chinese developer Evergrande. According to several reports, the giant enterprise is on the verge of collapse, which could have huge implications, especially in China.

AUDUSD pair fell below major support at 0.7340 which coincides with 50 SMA (green line) and 23.6% Fibonacci retracement of the last downward wave. If current sentiment prevails, then the downward move may accelerate towards support at 0.7110 which is marked by the lower limit of the 1:1 structure. Source: xStation5