Gold and silver futures marched lower Wednesday as the dollar found traction on rate-hike expectations and U.S. stocks gained on the back of mostly upbeat earnings results.
“Haven” gold tends to move opposite the dollar and riskier stocks, but while gold has been choppy in recent sessions as stock indexes test records, the yellow metal remains underpinned by global growth uncertainty.
August gold fell $16, or 1.2%, to $1,316.30 an ounce. Prices are on track to log their lowest settlement in a month, just a day after marking their highest finish in nearly a week.
“The yellow metal had a huge run in 2016, and is entering a consolidation phase,” said Nico Pantelis, head of research at Secular Investor. “This could last during the summer months, a period known as the ‘summer doldrums’ for the precious metals arena.”
“The price of gold is now on its way towards $1,300, and if this support level breaks, we will probably see $1,280 in short notice,” he said. “We don’t see gold [correcting] much further, as we see this correction as part of a move higher in [the] fall.”
Pantelis said gold could trade up to $1,400 to $1,500 an ounce.
For now, strength in the U.S. dollar contributed some pressure to gold, which is priced in the greenback. The ICE U.S. dollar index most recently was edging modestly higher at 97.12, up less than 0.1%, but it’s up 0.4% for the week and 1.1% for the month so far.
via MarketWatch
Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.
Alfonso Esparza
trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Latest posts by Alfonso Esparza (see all)
- Market Rally Still Going Low Holiday Volumes Awaiting Start of 2020 - 27 December 2019
- Market Awaits China Retaliation on Trade - 29 November 2019
- Alibaba to Close Order Book Ahead of Huge IPO - 18 November 2019