Gold Bulls Attracted To The Dip

Gold Bulls Attracted To the Dip

Gold bulls attracted to the dip this morning. Gold had slipped overnight as equities soared to new record highs. The yellow metal regained some ground after the release of U.S. employment data this morning, before slipping back. Then Gold bulls stepped back in erasing the dip.

The Bureau of Labor Statistics’ U.S. nonfarm payrolls report for December shows a gain of 145,000 jobs in December, that’s below the projected 164,000 figure; while the U.S. unemployment rate remained unchanged at 3.5%, a 50-year low. Gold briefly recovered all daily losses on the news with the February Comex gold contracts jumping to $1,555.20. After retreated a bit, resting currently at $1,554.60.

Gold fell Thursday as news that a phase-one trade agreement with China would be signed next week sent the Dow Jones Industrial Average, the Standard & Poor’s 500 Index and the Nasdaq Composite Index to close at new all-time highs. Stocks also rallied and precious metals declined as concerns about a possible war in the Middle East diminished.

Gold surged above $1,600 an ounce for the first time in almost seven years earlier this week and platinum hit a new record after Iran attacked two bases housing U.S. troops in retaliation for a U.S. airstrike ordered by President Donald Trump last week that killed Qasem Soleimani, the head of Iran’s Islamic Revolutionary Guards Corps’ Quds Force unit, at Baghdad International Airport.

Gold faces technical resistance near the January high around $1,611 and has short-term support near the 10-day moving average at $1,537, according to a technical analysis from FX Empire.

In economic news, U.S. initial jobless claims fell more than expected last week, with data released Thursday by the Labor Department showing new applications for unemployment benefits declined by 9,000 to a seasonally adjusted 214,000. But the number of Americans on the unemployment rolls increased, CNBC reported. U.S. consumer confidence surged to the highest level since October 2000, according to Bloomberg’s index.

Meanwhile, Federal Reserve Vice Chairman Richard Clarida said Thursday that “monetary policy is in a good place and should continue to support sustained growth.” In remarks to the Council on Foreign Relations in New York, he said that “as long as incoming information about the economy remains broadly consistent with this outlook, the current stance of monetary policy likely will remain appropriate.”

Silver fell 1.3% Thursday to settle at $17.94 an ounce on Comex. The March futures contract slid 1.2% during the first four days of this week.

Spot palladium, a metal used primarily in autocatalysts, hit another record above $2,000 an ounce on Thursday amid a supply crunch. It rallied 6.2% in the first four days of this week and 0.2% Thursday. Spot platinum was up 1.4% Thursday and is down 1.5% so far this week.

 

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