Gold was little changed on Wednesday in the wake of minutes from the
latest U.S. Federal Reserve meeting, but the precious metal was trading
above the two-week low hit in the last session as stock markets slid on
fresh trade tensions.
Spot gold was steady at $1,273.68 per ounce, having fallen to its lowest level since May 3 on Tuesday at $1,268.97.
U.S. gold futures settled 0.1% higher at $1,274.20.
minutes from U.S. Fed’s last meeting showed policymakers agreed that
their current patient approach to setting monetary policy could remain
in place “for some time.”
“Not many surprises here and not many
were expected. I would note though that this Fed meeting happened before
China backtracked on the trade talks. At the next meeting, almost
certainly there will be more caution,” said Tai Wong, head of base and
precious metals derivatives trading at BMO.
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Gold prices rose on Friday and were set to post a
weekly rise as the United States raised tariffs on Chinese goods,
exacerbating fears of a global economic slowdown, while palladium surged
more than 5% on technical buying and short covering.
The United States intensified a tariff
war with China on Friday by hiking levies on $200 billion worth of
Chinese goods. U.S. President Donald Trump said on Friday he was in no
hurry to sign a trade deal with China.
The escalation in the
U.S.-China trade dispute has weighed on stock markets worldwide and
boosted demand for assets viewed as safer.
“Gold is up today and will be up
in the short term until there is a concrete resolution to the
continuing trade tensions between the United States and China,” said Rob
Lutts, chief investment officer at Cabot Wealth Management.
Spot gold gained 0.2% to $1,286.56 per ounce and is up about 0.6% so far this week.
U.S. gold futures settled up 0.2% at $1,287.40.
“Gold is kind of inching high because of instability in the equities market,” said INTL FCStone analyst Edward Meir.
Palladium climbed 4.7% to
$1,354.51 per ounce as of 1:32 pm EDT (1732 GMT), having fallen to its
lowest since Jan. 4 at $1,263.85 in the previous session. The metal was
on track for a second straight weekly decline of about 1.2%.
“The price slide (on
Thursday) temporarily made palladium cheaper than gold again for the
first time since the start of the year,” Commerzbank analysts said in a
“The nice $70 bounce in
the palladium prices is on the back of some modest consumer buying after
the move below $1,300 yesterday and short-covering,” said Tai Wong,
head of base and precious metals derivatives trading at BMO.
For gold, the U.S.-China
trade conflict could also force the U.S. Federal Reserve to cut interest
rates, which could further support bullion prices.
Global anxiety has also
seen an uptick as U.S. bombers arrived at a U.S. base in Qatar to
counter what Washington describes as threats from Iran.
“The Iran situation is
not improving. Trump’s policies have led to a change in the dynamics.
We’re not sure whether the changes will make the situation safer or not
but the uncertainty will affect how investors see gold,” Lutts added.
Bullion was also
supported by a weaker dollar which fell after data showed a
smaller-than-expected rise in the U.S. consumer price index last month.
Silver was up 0.2% at $14.78 per ounce, while platinum rose 2.3% to $863.75.
Silver is on course to register a second straight week of declines, while platinum looks set for a third weekly drop in a row.
(Kitco News) –Gold prices are trading slightly lower in early-afternoon U.S. action Thursday, and did hit another four-month low today. A strong U.S. dollar that saw the dollar index hit new high for the year today is working against the precious metals market bulls. June gold futures were last down $1.60 an ounce at $1,275.20. May Comex silver was last up $0.006 at $14.945 an ounce.
U.S. economic data out today was a mixed bag but mostly upbeat,
including jobless claims falling by 5,000 in the latest reporting week.
March U.S. retail sales beat expectations and came in at up 1.6%. Gold
and silver prices initially down-ticked a bit on the earlier reports’
releases but then moved back to near unchanged levels on the day, where
they now remain.
U.S. and many other nations markets are closed on Friday for the Good Friday Easter holiday.
The marketplace, especially the FOREX sector, is keeping a very
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the U.S. dollar recently. There are concerns about Turkey’s low
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U.S.-China trade negotiations are continuing and apparently the
world’s two largest economies are moving closer to a final agreement.
There is talk in the marketplace that President Trump and Chinese
President Xi Jinping could meet next month to seal the deal.
The other key outside markets today finds Nymex crude oil prices are slightly down and trading around $63.50 a barrel.
Technically, June gold futures
prices closed nearer the session low today. The bears have the overall
near-term technical advantage. A two-month-old downtrend line on the
daily bar chart is in place. Gold bulls’ next upside near-term price
breakout objective is to produce a close above solid technical
resistance at $1,300.00. Bears’ next near-term downside price breakout
objective is pushing prices below solid technical support at $1,250.00.
First resistance is seen at Wednesday’s high of $1,282.10 and then at
Tuesday’s high of $1,291.70. First support is seen at $1,270.00 and
then at $1,260.00. Wyckoff’s Market Rating: 4.0.
May silver futures
prices closed near mid-range. The silver bears have the overall
near-term technical advantage. A two-month-old downtrend is in place on
the daily bar chart. Silver bulls’ next upside price breakout objective
is closing prices above solid technical resistance at the April high
of $15.31 an ounce. The next downside price breakout objective for the
bears is closing prices below solid support at $14.50. First resistance
is seen at this week’s high of $15.055 and then at $15.25. Next
support is seen at this week’s low of $14.795 and then at $14.75.
Wyckoff’s Market Rating: 4.0.
May N.Y. copper closed down 450 points at 292.25 cents today. Prices
closed near mid-range today on profit taking after hitting a 9.5-month
high on Wednesday. The copper bulls still have the overall near-term
technical advantage. Copper bulls’ next upside price objective is
pushing and closing prices above solid technical resistance at 300.00
cents. The next downside price objective for the bears is closing
prices below solid technical support at the March low of 283.45 cents.
First resistance is seen at today’s high of 296.40 cents and then at
this week’s high of 299.55 cents. First support is seen at today’s low
of 290.30 cents and then at the April low of 288.35 cents. Wyckoff’s
Market Rating: 6.5.By Jim Wyckoff
(Kitco News) –
The U.S. labor market continues to build momentum, pushing gold prices
to session lows, as the Labor Department reported
stronger-than-expected jobless claims.
Initial weekly U.S. jobless claims fell by 10,000 to a seasonally
adjusted 202,000 in the week to Saturday, the Labor Department reported
“This is the lowest level for initial claims since December 6, 1969 when it was 202,000,” the report said.
Consensus expectations compiled by various news organizations had
called for initial claims to be around 216,000. The government revised
the previous week’s report up by 1,000 to 212,000 claims.
Meanwhile, the four-week moving average for new claims – often
viewed as a more reliable measure of the labor market since it
smoothens out week-to-week volatility – fell by 4,000 claims to
Continuing jobless claims, the number of people already receiving benefits and reported with a one-week delay, dropped by 38,000 to a seasonally adjusted 1.717 million during the week ending March 23, the government said.
(Kitco News) – Gold
and silver prices are posting moderate corrective gains in
early-morning dealings Friday, following the sharp losses suffered
Thursday. Overnight, gold did drop to a three-week low, while silver
hit a three-month low. Some mild U.S. inflation data just released is
also helping out the precious metals market bulls. April gold futures
were last up $6.10 an ounce at $1,295.90. May Comex silver was last up
$0.122 at $15.09 an ounce.
The just-released U.S. personal income and spending report for
February came in at up 0.2%, which was in line with market
expectations. The January personal consumption expenditures price index
came in at down 0.1% from December and up 1.8%, year-on-year. Personal
spending in January came in below expectations, at up 0.1% from
December. These numbers fall into the camp of the U.S. monetary policy
doves, who do not want to see U.S. interest rates rise anytime soon.
Metals prices did up-tick after hit report hit the news wires.
Asian and European stock indexes were mostly firmer overnight. U.S.
stock indexes are pointed toward slightly higher openings when the New
York day session begins. Today is the last trading day of the week, of
the month, and of the quarter, which makes it an extra important
trading day from a charts and technical perspective. Traders and
investors are exhibiting a bit more risk appetite late this week, which
has buoyed world stock markets but has helped to sink the safe-haven
gold and silver markets.
The U.S. and China held high-level trade talks in Beijing late
Thursday and Friday. U.S. Treasury Secretary Steven Mnuchin said those
talks were productive. However, Larry Kudlow, President Trump’s
economic advisor, said on Thursday any final U.S.-China trade accord is
likely to come months down the road. There is no clear consensus in
the marketplace on the eventual outcome of the U.S.-China trade talks,
which means that when any final result is announced it is likely to
cause at least some volatility in some markets.
The U.K. Parliament is likely to vote Friday on another option
offered by Prime Minister Theresa May to break the Brexit deadlock.
There are not high expectations for her latest plan to be approved by
the MPs. Today is the day the U.K. was set to leave the European Union.
May’s options moving forward on the matter are increasingly limited,
with speculation of a general election being held in the near future.
The key outside markets today see the U.S. dollar index higher and
hitting another 2.5-week high today. The USDX is back near its recent
multi-month high. Meantime, Nymex crude oil prices are higher and
trading around $60.00 a barrel. Oil prices are still trending higher on
the daily bar chart even though price action has been sideways this
Feb 15 – Gold jumped to a two-week high on
Friday after weak U.S. economic data boosted expectations the U.S.
Federal Reserve would hold pat on monetary tightening, while palladium
matched an all-time high on a prolonged deficit.
Spot gold was up
0.4 percent at $1,317.36 an ounce at 12:47 p.m. EST (1747 GMT), having
touched its highest since Feb. 1 at $1,319.81.
U.S. gold futures rose 0.5 percent to $1,320.60.
While gold is on track for a small weekly gain, it was rangebound for most of the week, with gains on Friday stemmed by a firmer dollar and a rebound in stocks.
Risk appetite in equity and forex markets and positive US dollar in the broad market caused precious metals to decline in broad market.
Precious metals today saw sharp downside move as market scenario
returned to normal following an eventful month. Given the fact that
there is no major market altering events in the week ahead and the fact
that market is set to see a week full of first tier macro data updates,
investor sentiment is positive with plenty of risk appetite across all
major global markets. Further US Dollar gained strength in the broad
market following upbeat US NFP data and ISM Manufacturing PMI released
last Friday. The dollar has retained its strength across Asian and early
European market hours which also added to precious metal market bears.
Brent Crude Climbs Above $60 Per Barrel
Positive US dollar in broad market is always bearish for greenback denominated precious metals. A higher value of USD discourages participants from emerging markets owing to higher exchange rate which further reduces activity in the precious metals market. Risk appetite is currently very high in broad market as headlines last week hinted that China & U.S. managed to come to an agreement on many key issues which improved chances of a trade deal between two nations. As of writing this article, spot gold XAUUSD is trading at $1310.92 per ounce down by 0.51% on the day while US gold futures GCcv1 was trading at $1314.90 per ounce down by 0.54% on the day. Meanwhile, spot silver XAGUSD is trading at $15.75 per ounce down by 0.92% on the day.
Gold prices posted a slight decline on Monday, holding above $1,230 an ounce for a third straight session as traders eyed some weakness in the U.S. dollar a day ahead of the closely watched midterm elections.
“Stepping back from today’s price action, what is most interesting for gold is how well it has held its ground despite a significant rally in the U.S. Dollar Index in recent weeks,” Michael Armbruster, managing partner at Altavest, told MarketWatch. “When it comes to gold, it’s easy to be lulled into a sense of complacency when the U.S. dollar is trending higher along with interest rates.”
Gold for December delivery GCZ8, -0.37% edged down $1, or less than 0.1%, to settle at $1,232.30 an ounce, squarely between the day’s high of $1,236.60 and low of $1,228.40.
The contract ended last week slightly lower after a report showed a U.S. job market that was even stronger than expected—data seen keeping the next Federal Reserve interest-rate hike likely on track for December. Higher rates dull the appeal of nonyielding bullion, while boosting the dollar, making dollar-priced commodities less attractive to investors using other currencies.
Still, data Monday showed the nonmanufacturing index compiled by the Institute for Supply Management slipped to 60.3 last month from a 21-year high of 61.6 in September.
The dollar continued its decline after the ISM services survey, with the ICE U.S. Dollar index DXY, -0.06% down 0.3% at 96.286 in Monday dealings. Last Thursday, gold settled at its highest level in more than three months when the index weakened and as stock markets wrapped up a dismal October.
“Increased risk aversion with the equity markets’ selloff has certainly added a risk-averse boost to gold in recent weeks, but if the dollar starts to lose traction due to the reversal of the U.S.-China trade dispute, then this could be a driver of continued gold strength,” said Richard Perry, analyst at Hantec Markets.
Perry is watching $1,236 as a technical “line in the sand” for gold and says a consistently higher market at that price opens the way to a climb toward $1,266.
Armbruster pointed out that “investors should keep in mind that central banks around the world (China, Russia and others) are reportedly adding to their gold holdings. Such behavior by central banks may trump headwinds from the dollar and interest rates and result in a surprise rally.”
This month’s rally in gold prices may not be over.
That’s because investors are still heavily betting on a decline in the value of the precious metal. When speculators overwhelmingly bet in one direction then a move in the opposite way is often the result.
Bars of gold bullion. Rob Bennett/AP Images for APMEX
Investors wanting to profit from a likely upward move in prices might consider buying the SPDR Gold Shares exchange-traded fund (ticker: GLD) which hold bars of solid gold bullion. Alternatively, try buying December-dated futures contracts on the CME futures exchange.
On October 1, I wrote that speculators were betting so heavily on a further decline in gold prices that we’d likely see a rally. You can read the story here. Starting late January gold prices tumbled until they reached a recent low in mid-August.
However, even as the price stabilized traders held onto those so-called short positions, also known as bets on a decline in prices, and kept betting on further falls in the price.
By early October the negative bets became extreme and hence increased the likelihood of a gold price rally.