Gold prices fell towards the $1,645 level at the opening of the midweek session in New York as the US dollar climbed slightly on the trade-weighted index. The initial action was rather subdued but speculators were perhaps justifiably skittish.
The US dollar and stock index futures frowned upon the GDP estimate and headed lower. The development may give gold players another chance at trying to go for the assault on the $1,660-$1,675 resistance area.
Gold prices added over 1% ahead of the ECB rate-setting meeting this morning as the post US jobs data-sparked Friday rally continued to unfold. The gold market’s net speculative length is at or very near multi-year lows.
The midweek trading session in New York started with fresh declines across the precious metals’ price boards as the US dollar resumed its ascent on the trade-weighted index in the wake of an “uncooperative” Fed.
The metals complex opened higher this morning as the pre-long weekend book-squaring ritual got underway and as players awaited Mr. Bernanke’s words from Jackson Hole. Gold advanced $5 to $1,660 while silver rose 20 cents to $30.70 per ounce.
While not all was well and back to normal this morning, electronic trading quotes enabled us to round up some prices for you to glance at. Spot gold was last seen near $1,713 while silver traded at $32 per ounce on the bid-side.
This morning’s indications showed gold and silver partially reversing yesterday’s losses with modest gains on the order of $4 and 11 cents, respectively. On the other hand, platinum and palladium each advanced by about one percent in the cash markets.
Last year’s ETF gold demand stands at the lowest annual level since these vehicles were launched late in 2004. Many ETF speculators still hold large positions, but recent price drops and rising volatility have eroded a portion of the belief that gold is always a “safe haven” investment.