Breaking News
0

PRECIOUS-Gold prices recover on short-covering

CommoditiesMay 16, 2018 02:51
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. PRECIOUS-Gold prices recover on short-covering

* Dollar index hovers near 5-month high

* Benchmark U.S. Treasury yield hovers around 3 percent

* Spot gold may bounce to resistance at $1,302/oz- technicals

By Apeksha Nair

BENGALURU, May 16 (Reuters) - Gold prices recovered some lost ground on Wednesday on short-covering after prices fell to the lowest level this year in the previous session on surging U.S. bond yields and a stronger dollar.

Spot gold XAU= rose 0.3 percent to $1,294.30 per ounce at 0639 GMT, after shedding 1.7 percent and marking the lowest this year at $1,288.31 in the previous session.

This was also the lowest price level for the yellow metal since Dec. 28.

U.S. gold futures GCcv1 for June delivery were up 0.3 percent at $1,293.60 per ounce.

"Rising U.S. bond yields and a stronger dollar were factors behind gold's decline below the $1,300 level. The slight pick up suggests that there might have been some opportunistic buying on the part of investors," said John Sharma, an economist with National Australia Bank.

A stronger dollar makes greenback-denominated gold more expensive for holders of other currencies, while rising U.S. yields tend to weigh on bullion's non-yielding appeal.

The dollar on Wednesday hovered near a five-month high against a group of major currencies, boosted by a surge in the benchmark 10-year Treasury yield after strong U.S. retail data on Tuesday. USD/ US/ Asian shares were under pressure after North Korea cancelled high-level talks with Seoul, denouncing military exercises between South Korea and the United States and throwing into question next month's unprecedented summit between Kim Jong Un and U.S. President Donald Trump. MKTS/GLOB global political tensions continued to provide safe-haven support to the metal, investors said the main price drivers would likely remain a stronger dollar and rising U.S. interest rates.

"There are lot of geopolitical risks but people are just used to it. Therefore it has not become a big driver for gold," said Helen Lau, analyst at Argonaut Securities.

Higher interest rates in the United States amid a rising dollar will continue to add downward pressure on gold, Lau said.

Spot gold may bounce to a resistance at $1,302 per ounce, before falling again, Reuters technical analyst Wang Tao said. other precious metals, silver XAG= was up 0.4 percent at $16.30 per ounce after falling about 1.6 percent on Tuesday in its biggest one-day percentage decline since April 23.

Platinum XPT= rose 0.4 percent to $897 an ounce, while palladium XPD= eased 0.1 percent to $981.72 an ounce after recording the biggest single-day percentage loss in two weeks at 1.3 percent in the previous session.

PRECIOUS-Gold prices recover on short-covering
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email