Gold Silver Reports – Gold prices drifted in a narrow range on Friday after hitting a near three-week low in early trade as the dollar gained against the euro after the European Central Bank (ECB) extended its bond buying programme.
Spot gold was roughly unchanged at $1,267 per ounce as of 8.23am after touching its lowest since 6 October at $1265.08. Gold was headed for an about 1% weekly decline. US gold futures for December delivery shed 0.1% to $1,268.00.
“How gold finishes the week will now be entirely at the whim of the US dollar and US yields with little to no geopolitical safe haven premium left in the price,” said Jeffrey Halley, a senior market analyst with OANDA, in a note. “The futures market is still constructively long the yellow metal, and this will continue to weigh on prices as fresh buyers appear to be few and far between.”
The dollar stood tall on Friday, on track for weekly gains, while the euro slumped to three-month lows after ECB Policy extended its bond purchases and reduced the chances that it would hike interest rates in 2018. A strong greenback makes dollar-priced gold costlier for non-US investors.
“It looks like we are going to be heading a bit lower from here, from both the fundamental and technical points of view,” INTL FCStone analyst Edward Meir said. “The next support for gold prices is the 6 October low ($1,260.2) and if it breaks that, next support is around $1,257. The key support lies around the $1,262.80 level and once it breaches that, it could spur more fund selling.”
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Spot gold may revisit its 6 October low of $1,260.16 per ounce as it has broken a support zone of $1,271-$1,268, according to Reuters technical analyst Wang Tao. An impending decision on the US Federal Reserve’s next chair could also be an important driver for the metal, analysts said.
President Donald Trump’s search for the next Fed chair has come down to Fed Governor Jerome Powell and Stanford University economist John Taylor, Politico on Thursday cited one source as saying, while another counselled caution.
Meanwhile, the US house of representatives helped pave the way on Thursday for deep tax cuts sought by Trump and Republican leaders, underpinning the greenback.
Gold is likely to flatline for another year in 2018 as rising US interest rates clip momentum, a Reuters poll showed on Thursday. Autocatalyst metal palladium will struggle to maintain its recent push to 16-year highs above $1,000 an ounce.
Silver prices were little changed at $16.74 per ounce, platinum dipped 0.4%, to $914, while palladium was 0.2% lower at $967.05. All three metals were on track for weekly declines. – Neal Bhai Reports
