Gold edged lower on Thursday as the dollar traded within reach of an almost 14-year high hit on positive U.S. economic data, which increased expectations of the Federal Reserve increasing interest rates in December.
Fed policymakers appeared confident on the eve of the U.S. presidential election that the economy was strengthening enough to warrant rate increases soon, minutes from the central bank's Nov. 1-2 meeting showed. Spot gold was down 0.1 percent at $1,186.60 an ounce by 1518 GMT. It dropped 2 percent in the previous session and touched its lowest since Feb. 8 at $1,180.99 overnight.
In other news, top consumer China's net gold imports via main conduit Hong Kong rose 15.8 percent in October to the highest in three months, data showed on Thursday. Spot silver rose 0.2 percent to $16.37 an ounce after falling to its lowest since June in the previous session. Platinum was down 1.3 percent at $918.50, having earlier hit a 9-1/2 month low, while palladium rose 0.5 percent to $736.50.
After Wednesday’s nearly 2% drop in gold, investors have a one-day reprieve as U.S. markets are closed for Thanksgiving, and according to some analysts, the outlook is mixed.
Among technical indicators, the gold market saw a fairly bearish signal on Wednesday as priced dropped below $1,200 an ounce and the 50-day moving average slipped below the 200-day moving average, forming what is called a death cross, a signal of continued downward momentum in the near-term.
Colin Cieszynski, chief market strategist at CMC Markets Canada, said that while momentum could favor lower prices in the near-term, he does see signs that the yellow metal is due for a bounce. “When gold broke through $1,200 yesterday, it triggered a mass of automated selling and that has pushed the market into extremely oversold territory,” he said.
Reference: KITCO, Reuters
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