Gold slipped lower overnight, giving back a small proportion of yesterday’s gains. Gold also had a strong session at the end of last week, and this has helped push prices back up towards $3,400.
Gold is reacting to moves in the US dollar, and the latter was sharply higher this morning, bouncing back after a generally weak August. The dollar also fell sharply on Friday following Fed Chair Powell’s ‘dovish’ tilt in his Jackson Hole speech.
Despite this, gold continues to trade in a widish range of $3,450-$3,250, meaning it is still somewhat shy of April’s record high of $3,500. Sentiment remains broadly positive towards gold, and silver.
Source: TN Trader
Investors have increased their exposure to precious metals as a safety trade, to reduce their exposure to US dollars (which President Trump wants to weaken) as well as providing an investment outside the somewhat frothy US equity markets.
The bulls will argue that gold is just waiting for the right catalyst. The bears will say that there are better investments out there, and that gold topped out in April.
