Gold up 1%, First Major Gain in A Week as Dollar Drops

Commodities & Futures
© Reuters.  © Reuters.

By  Barani Krishnan – Gold prices settled New York trade up 1% on Thursday, posting their first significant gain in a week after a near $ 200 bloodbath triggered by ramping U.S. Treasury yields and a rebounding dollar.

Gold for on Comex settled up $ 21.40, or 1.1%, at $ 1,970.40 per ounce after peaking at $ 1,974,75. It was still a humble performance for the yellow metal which last Friday got up to $ 2,089, the highest ever for any gold futures contract on Comex, before tumbling to $ 1,874.20 on Tuesday.

“Gold prices are trading heavily against other pro-risk assets, particularly following the upside surprise,” said TD Securities in note. “Considering the uber-bullish sentiment in gold markets, along with bloated positioning and the recent surge in speculative activity among retail accounts, we suspect that the pullback may still have room to run.”

Ed Moya at OANDA in New York had a similar point: “Gold’s rebound is somewhat hesitant as investors are unsure if the Treasury curve will continue to steepen and that might limit dollar weakness.”

The down about 0.1% on Thursday, handing gold its rise.

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