After a Monday morning flash crash in gold and silver what comes next

A sea of red for commodities into the end of last week following the better than expected non-farm payrolls data that showed the US economy added 943,000 positions in July, up from an upwardly revised 938,000 in June.

Gold 2

The unemployment rate dropped more than expected, to 5.4% from 5.9%, indicative of a continuation of growth and a healing labour market, but not at a fast enough pace to stoke fears of a sooner than expected taper.

The better jobs data sent the US dollar and US bond yields higher, never a good formula for commodities. Gold was amongst the worst performers on Friday as it closed over $40 lower at $1762.70 (-2.29%), just above crucial uptrend support coming in $1755/50 area.

After an innocuous first hour of trading for the new week, at 8.50 am Sydney time or 6.50 pm ET, gold slipped through the $1750 support level and within 10 minutes had fallen -$73.00 on the back of what appears to have been stop-loss related selling in very thin market conditions.

“Flash crashes” are not uncommon during the early hours of the Asian time zone. For more information on why a “flash crash” might occur, please refer to an article we wrote on a flash crash in AUDJPY in 2019 that hopefully will provide more insights here.

This morning’s fall in gold triggered a plunge in silver from $24.00 down to a low of $22.10. Offering some encouragement for those quick enough and brave enough to buy the dip in gold, the $1677 low in gold was just ahead of the $1676 double low from March this year.

Gold has since recovered and is trading near $1740, below former support, now resistance at $1750/60. Silver has rebounded and is currently trading at $23.90, just below former support, now resistance at $24.00/20.

Both gold and silver need to reclaim the resistance levels mentioned above on a daily closing basis. Otherwise, the risks are for a retest of this morning’s “flash crash” lows in the coming sessions.


Source Tradingview. The figures stated areas of 9th of August 2021. Past performance is not a reliable indicator of future performance.  This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation

More from Commodities


This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit for the complete Risk Disclosure Statement.