· Gold eased from a more than one-week high on Friday as hopes for global measures to soften the blow of the coronavirus outbreak increased appetite for equities, but more new cases limited bullion losses and kept the precious metal on track for a weekly gain.
Spot gold was down 0.1% at $1,575.35 per ounce as of 0651 GMT, having touched its highest since Feb. 4 at $1,577.89 earlier in the session.
U.S. gold futures were flat at $1,578.50.
· “Equities market has shrugged off the bearish sentiment and has started to move higher as investors are reassessing the potential (economic) impact of the virus,” Margaret Yang Yan, a market analyst at CMC Markets said, adding that a strong dollar is also pressuring bullion.
· Asian shares looked to post their second straight week of gains, while the dollar rose to an over four-month high.
However, analysts said interest in gold remained intact as the death toll in China’s Hubei province rose, with nearly 5,000 new cases of infection.
Bullion has gained about 0.3% so far this week.
· Expectations that the virus could hurt the global economy as well as easy monetary policy from central banks are keeping gold attractive, CMC’s Yan said.
· Investors are watching for U.S. retail sales and consumer confidence numbers due later in the day.
· “The U.S. consumer is really the biggest piece of global growth at this point, with China getting a hit due to the trade war and the virus. Europe is still sluggish,” said Ilya Spivak, a senior currency strategist at DailyFx.
· Elsewhere, palladium rose 0.4 % to $2,433.36 per ounce and looked to register its best week in a month.
· Silver gained 0.3% to $17.68, while platinum was up 0.2% to $969.28.
· Gold: renewed fears of Coronavirus drives safe haven flow once more
The near term consolidation of the past few days on gold has been playing into our neutral outlook. However, although the past couple of sessions have seen the bulls ushered to the side-lines, renewed fears of Coronavirus overnight have driven safe haven flow once more. Gold is subsequently testing higher again. Resistance in the $1572 (23.6% Fibonacci retracement of $1445/$1611) and $1577 (Monday’s intraday high) is being tested this morning. However, trading under $1591 (the February high) we see a continuation of what is developing into a multi-week range. For now, we are happy to retain our neutral stance for the near to medium term outlook. The unwinding moves on RSI (still drifting under 60) and MACD (still in a benign drift back towards neutral) backs this too.
Reference: Reuters, FXstreet
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