Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

PRECIOUS-Gold prunes gains on reconciliatory trade comments, profit-booking

Published 2019-08-26, 05:03 a/m
Updated 2019-08-26, 05:03 a/m
© Reuters.  PRECIOUS-Gold prunes gains on reconciliatory trade comments, profit-booking

© Reuters. PRECIOUS-Gold prunes gains on reconciliatory trade comments, profit-booking

* Speculators increase net longs in COMEX gold

* Gold may peak $1,546-$1,569/oz range -techs

(Adds fresh comment, recasts story)

By Harshith Aranya

Aug 26 (Reuters) - Gold prices erased early gains on Monday, slipping from a six-year high touched during the session, as some of the safe-haven demand waned after the United States and China indicated a possible de-escalation of trade war, that also led to some profit-taking.

Spot gold XAU= rose 0.1% to $1,527 per ounce as of 0822 GMT, after hitting $1,554.56 an ounce earlier, its highest since April 2013.

The bullion had hit this level after tit-for-tat tariffs by the U.S. and China escalated trade tensions, and boosted demand for safe-haven assets.

U.S. gold futures GCcv1 were also up 0.1% at $1,538.70 an ounce.

"The main news is (U.S. President Donald) Trump has commented that he is ready to negotiate with China, and China has also said they want a deal to happen," said Renisha Chainani, head of commodity and currency research at Monarch Networth Capital in Ahmedabad, India.

"This has changed the sentiment in the market from risk-off to risk-on, and safe haven assets are seeing some profit booking. This is a knee-jerk reaction."

Trump said on Monday China had contacted U.S. trade officials overnight to say they wanted to return to the negotiating table. Chinese Vice Premier Liu He had said that China opposes the escalation of the trade conflict, a state-backed newspaper reported. Friday, Trump had announced a 5% additional duty on $550 billion in targeted Chinese goods, hours after Beijing unveiled retaliatory tariffs on $75 billion worth of U.S. products. markets plunged in response, with the U.S. stocks slumping on Friday, followed by a steep fall across Asian shares on Monday. MKTS/GLOB

On Friday, Fed Chair Jerome Powell said the U.S. central bank will "act as appropriate" to keep the economy healthy, although he stopped short of committing to rapid-fire rate cuts. markets are fully priced for a quarter-point cut in rates next month, and over 100 basis points of easing by the end of next year. FEDWATCH

Yields on 10-year Treasury notes US10YT=RR dived to its lowest since mid-2016, from a top of 1.66% on Friday. US/

Lower bond yields reduce the opportunity cost of holding non-interest bearing gold.

The dollar index .DXY , which measures the greenback's value against a basket of six major currencies, was up 0.3%. USD/

Spot gold may peak in a range of $1,546-$1,569 per ounce, said Reuters technical analyst Wang Tao. of market sentiment, SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, said its holdings rose 0.58% to 859.83 tonnes on Friday. GOL/ETF

Hedge funds and money managers increased their bullish stance in COMEX gold in the week to Aug. 20, the U.S. Commodity Futures Trading Commission said on Friday. silver XAG= was up 0.9% at $17.54 per ounce and platinum XPT= also gained 0.9% to $861.

Palladium XPD= climbed 0.9% to $1,473.70 per ounce.

https://tmsnrt.rs/2ZjwsVG

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.