Metals Stocks: Gold prices fight for 10th gain in a row as the U.S. dollar rebounds

This post was originally published on this site

Gold futures were little changed Tuesday morning after the commodity marked the highest settlement since April of 2013 on Monday, as investors weighed the prospects for further escalation in tensions between the U.S. and Iran.

“Tensions in the Middle East are likely to stimulate risk aversion, consequently boosting investor’s appetite for Gold,” wrote analysts at FXTM in a daily research note.

February gold GCG20, +0.03%  on Comex added 10 cents, or less than 0.1%, at $1,568.80 an ounce, after settling up 1.1% on Monday, marking the highest settlement since April 9, 2013, according to FactSet data.

Gold has risen for nine consecutive sessions, representing its longest period of gains since an 11-day streak that ran from December 2018 to January 2019.

Gold and safe haven assets have received bids after the killing last week of a top Iranian military commander, Qassem Soleimani, which has reverberated through financial markets, momentarily upending appetite for assets considered risky and boosting traditional haven assets like gold.

March silver SIH20, +0.12%  picked up a penny, or 0.1%, to trade at $18.185 an ounce, after a 0.2% gain on Monday.

However, some calm has taken hold of U.S. markets.

Read: Why geopolitical events are not a good reason to buy gold

Meanwhile, precious metals were facing some headwinds from strength in the U.S. which can influence trade in dollar-pegged commodities.

The U.S. ICE Dollar Index DXY, +0.27%, a measure of the buck against a half-dozen currencies, was up 0.2% at 96.87 erasing much of its decline in the previous session.

Investors also said technical factors could determine the next phase for gold, which already has enjoyed a strong move, even before the Middle East tensions flared up.

“Although prices have strong bullish momentum, further upside will depend on how prices react around $1555,” said FXTM analysts.

“The precious metal should trend higher towards $1600 as long as $1555 proves to be reliable support. Alternatively, a breakdown below this level may open the door towards $1535,” the researchers wrote.

Add Comment