• Gold rose on Tuesday after hitting a six-week low in the previous session as bargain hunting set in and the dollar slid sharply before speeches by US Federal Reserve officials and U.S. equities weakened, drawing investor attention to the precious metal.
• Fed officials have signalled that they plan to continue on their current trajectory of interest rate hikes despite a slow down in inflation. But softer-than-expected US data has given rise to some caution.
• Prices finished off the day’s best levels, however, losing ground as Federal Reserve Chairwoman Janet Yellen started speaking about global economic issues at an event in London in the minutes ahead of gold’s price settlement.
• August gold GCQ7, +0.23% added 50 cents, or less than 0.05%, to settle at $1,246.90 an ounce after touching an earlier high of $1,253.80.
• U.S. data Tuesday showing a larger-than-expected rise to 118.9 in the consumer confidence index also helped fuel a decline in gold and silver from the session’s highs.
• September silver SIU7, +0.41% rose 2 cents, or 0.1%, to $16.651 an ounce after trading as high as $16.73.
• “Gold appears to be setting into a $1,240 to $1,260 trading range—more or less between its 50- and 200-day averages,” said Colin Cieszynski, chief market strategist at CMC Markets. “It’s underlying bullish trend remains intact.”
• It would likely take “something new to kick it out of this range and spark a new move, but am not sure what that is yet,” he said.
• A huge sell order totalling 1.85-million ounces pushed gold to a six-week low on Monday, although the precious metal ultimately failed to break below the 200-day moving average.
• "If yesterday gold wasn’t able to push below the 200-day moving average that’s a positive sign," said ABN Amro analyst Georgette Boele.
• Early Tuesday, gold had found some underpinning as geopolitics clouded trade, lifting the short-term attraction of haven investments including the yellow metal. The Trump administration on Monday night accused the Syrian government of preparing another chemical weapons attack, and threatened the Syrian military would “pay a heavy price” if an attack was carried out.
• Metals action was proving more subdued than that seen to start the week. In electronic trading Monday, prices suffered a drop to around $1,242 from $1,255 an ounce in matter of minutes, according to charting from FactSet. Prices later touched a low of $1,236.50.
• Gold was “rocked by a 56 metric-ton (1.8 million-ounce) gold sale, but it remains a mystery who and why,” Ross Norman, chief executive officer of London-based Sharps Pixley Ltd., explained Monday.
Reference: Market Watch, Reuters
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