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​Gold falls as Fed's taper talks boost U.S. dollar

·         Gold prices slipped on Thursday, as the dollar catapulted to multi-month highs after U.S. Federal Reserve’s policy meeting minutes signalled it would start tapering its pandemic-era stimulus this year.

·         Spot gold fell 0.5% to $1,779.52 per ounce by 0640 GMT.

·         U.S. gold futures fell 0.3% to $1,779.50.

·         The dollar index scaled an over nine-month peak, making gold expensive for holders of other currencies.

·         “Gold lost a little bit of upside momentum as market participants increasingly grew wary of the risk that the Fed could start tapering its bond-buying by the end of the year,” IG Market analyst Kyle Rodda said.

·         Over the next few days, gold’s price action would be determined by the speculation relating to Fed tapering and what they might say about tapering at Jackson Hole symposium, Rodda added.

·         The minutes from July meeting showed U.S. central bank officials saw the potential to ease bond-buying programme this year if the economy continues to improve as expected.

·         However, the minutes also magnified the importance of the next few months’ jobs reports, with solid gains needed to meet the Fed’s expectations and show that the coronavirus has not begun to again slow the economy.

·         Gold had slumped to a more than four-month low of $1,684.37, following a robust July nonfarm payrolls data.

·         The precious metal is viewed as a hedge against inflation and currency debasement. The Fed’s tapering would tackle both those conditions thereby diminishing gold’s appeal.

·         “In the short term, this taper talk may put pressure on the gold price but I believe gold has priced in the spectre of higher rates,” said Vincent Tie, sales manager at Singapore dealer, Silver Bullion.

·         Spot silver fell 0.9% to $23.26 per ounce. Platinum dropped 1.2% to $982.94.

·         Palladium fell 0.6% to $2,413.02, after hitting its lowest level since March 16 at $2,409.68.

·         Gold Futures: Look consolidative/bearish near term

Open interest in gold futures markets rose for the fifth session in a row on Wednesday, this time by around 2.3K contracts considering preliminary readings from CME Group. On the other hand, volume remained choppy and shrank by around 16.6K contracts.

Gold stays capped near $1,800

Wednesday’s inconclusive session in gold prices was amidst rising open interest and now opens the door to some consolidative phase in the near term. However, further downside cannot be ruled out following another failure to surpass the $1,800 mark per ounce troy in past sessions.

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·         Bitcoin volatility will drive investors back to gold, says mining firm chairman

Wild swings in cryptocurrencies will eventually drive bitcoin investors to return to gold, says the executive chairman of gold mining firm Evolution Mining.

Jake Klein said bitcoin still has a “long way to go” before it demonstrates the kind of “longevity and security” that gold has proven to offer investors over the last 70 years.

Cryptocurrencies are “running a massive amount of speculative money,” he told CNBC’s “Squawk Box Asia” on Thursday.

“I think that the volatility in the crypto space is going to ultimately lead to people coming back to gold,” Klein said.

​·         Dollar hits 9-month high as Fed on track to taper this year

The dollar index, which measures the U.S. currency against six rivals, climbed as high as 93.502, its strongest since Nov. 5, before trading 0.26% higher at 93.464.

The euro fell as low as $1.16655 for the first time since Nov. 4.

·         EUR/USD Daily Forecast – Euro Slipped To Yearly Low

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 ​EUR/USD settled below the support at 1.1690 and is heading towards the next support level which is located at 1.1660. RSI is close to the oversold territory, but there is enough room to develop additional downside momentum in case the right catalysts emerge.

In case EUR/USD manages to settle below the support at 1.1660, it will head towards the next support level at 1.1625. A move below this level will open the way to the test of the support at 1.1600.

On the upside, the previous support at 1.1690 will serve as the first resistance level for EUR/USD. A successful test of this level will push EUR/USD towards the resistance at 1.1720. If EUR/USD gets above 1.1720, it will move towards the next resistance at 1.1750.

·         GBP/USD: Downmove to persist towards the 1.3660 mark – SocGen

GBP/USD is struggling around 1.37. According to economists at Société Générale, cable targets the 1.3660 support after failure to recapture the 200-day moving average at 1.3789.

Support 1.3660, resistance 1.3790

“GBP/USD has experienced a pullback after facing stiff resistance near daily Ichimoku cloud at 1.4000.”

“Failure to reclaim 200-DMA at 1.3790 can take the pair towards 1.3660 and recent trough of 1.3570.”

·         Hawkish Fed remark is the primary driver of Australian dollar weakness: Macquarie

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·         This map shows where cryptocurrency is taking off around the world

Global adoption of cryptocurrency has taken off in the last year, up 881%, with Vietnam, India and Pakistan firmly in the lead, according to new data from Chainalysis.