- Gold on its way to test Dec 2017 lows amid broad-based US dollar strength
- Losing safe-haven status, despite trade war fears?
Gold prices on Comex extend its declines for the fourth straight session, with the bears now looking to crack the key psychological support at $ 1250 amid persisting broad-based US dollar buying across the board.
The demand for the US dollar remains unabated across its main competitors amid looming US-Sino trade war fears, as markets prefer to hold the world’s reserve currency against the safe-haven gold. Meanwhile, the mixed signals from Washington deepened the US-China trade row, further fuelling the demand for the buck.
And hence, we see the yellow-metal prices showing little impact from the escalation in trade tensions. The US dollar index reached the highest levels since June 2017 at 95.53 while gold futures refreshed half-yearly lows at 1250.50
Also, in an evidence of reduced investor’s confidence in gold, the holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.36 percent to 821.69 tonnes on Wednesday.
Gold Technical levels
Resistances: $ 1256 (daily pivot), $ 1259.56 (5-DMA), $ 1265.63 (classic R2/ Fib R3).
Supports: $ 1240 (round number), $ 1236.50 (Dec 2017 low), $ 1214 (May 2017 low).
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