|Day's range||1,361.30 - 1,397.70|
(Bloomberg Opinion) -- For the past six years, there’s been no number more filled with dread for gold bulls than $1,350 an ounce. Barring a few brief spikes, the metal has struggled to break through that level ever since it came off its run-up to $1,900 between 2011 and 2013. This matters, because an asset that has few fundamental factors drivingits performance (short of its negative correlation to the greenback) is unusually susceptible to the psychological hocus pocus that can sometimes make technical analysis work.Thousands of investors believe that $1,350 an ounce is a “resistance level” that gold will struggle to break above. As a result, they’re likely to sell hard as the price approaches that point, and change their view of things if it confounds them by decisively moving higher.It looks like we’re in that territory now. After a momentary incursion above $1,350 on Tuesday, spot gold decisively broke through on Wednesday afternoon and climbed as high as $1,394 early in the Asian day Thursday. That’s its most elevated level since September 2013.The question is whether this is just another temporary spike.There’s some reason to think the best is already behind us. Investors tend to flock to the yellow metal when expectations of economic growth suffer a sharp setback. If you consider flight-to-safety sovereign bond rallies(2) over the past decade, the median peak gain for gold has been 7.2%. This time around, we’re already sitting on an 8% rise. At the same time, there are signs of a more dramatic re-evaluation of economic prospects than we saw in gold’s previous pips above $1,350 in July 2016 and March 2014.Federal Reserve Chairman Jerome Powell opened the door to interest rate cuts as early as next month in a media briefing after the central bank’s policy meeting Wednesday – almost certainly the main reason that gold has been looking so peppy. If the Fed cuts in July, it’s more likely to be by half a percentage point than a quarter-point, Robert Mead, co-head of Asia-Pacific portfolio management at Pimco, told the Bloomberg Buy-Side Forum in Sydney on Thursday.Should the Fed ease significantly – providing a “Powell put” to bail out an economy struggling under the weight of trade tariffs – you can expect to see a marked weakening of the dollar. That, in turn, ought to be good for gold.The deteriorating economic picture in Europe should also provide support. Gold doesn’t produce a return, but that’s not the disadvantage it once was in a world where sovereign debt in Germany, Sweden, the Netherlands, Switzerland, Denmark, Austria and Japan – and, perhaps soon, France – provides negative yields. Funds so far seem unconvinced. Money managers, a group that’s been relentlessly bullish on the prospects for gold futures and options over most of the past decade, have been net-short for 24 weeks out of the past year and were still expecting price falls just last month. While that spiked up to a net-long position of 156,718 contracts in the most recent week, such data is subject to sharp reversals whenever movements in the underlying asset give investors a chance to take profits.Still, in a world where uncertainty seems to spike every time the U.S. president opens his Twitter app, it’s hardly surprising a metal that thrives on chaos is finally getting its moment in the sun. The $1,350 level has been a price ceiling for gold for nearly six years. It could just as easilyturn into a floor in the future.(1) We're defining this as episodes when the yield on benchmark 10-year U.S. Treasuries fell by 40 basis points or more from a month earlier.To contact the author of this story: David Fickling at firstname.lastname@example.orgTo contact the editor responsible for this story: Rachel Rosenthal at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.David Fickling is a Bloomberg Opinion columnist covering commodities, as well as industrial and consumer companies. He has been a reporter for Bloomberg News, Dow Jones, the Wall Street Journal, the Financial Times and the Guardian.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Investing.com - Gold prices jumped on Thursday in Asia after the U.S. Federal Reserve kept the door open for an interest rate cut later this year.
(Bloomberg) -- Spot gold climbed to close at the highest in more than two years after the Federal Reserve signaled a readiness to cut U.S. interest rates, citing increased economic uncertainties.While policy makers left their key rate unchanged on Wednesday, they dropped a reference in their statement to being “patient” on borrowing costs and forecast a larger miss of their 2% inflation target this year.Gold has posted four straight weekly gains, partly on bets that the Fed will lower interest rates amid signs that escalating trade disputes are affecting the U.S. economy. Low rates are a boon to precious metals, which don’t offer yields.“Even though the Fed didn’t cut rates, the market expectation for a dovish environment and a likely rate cut in July are positive for gold,” Maxwell Gold, the New York-based director of investment strategy at Aberdeen Standard Investments, said by email. “As concerns around slowing global growth and trade put further pressure on monetary policy globally, gold may see further support.”The Fed still expects a strong labor market and inflation to be near its goal but “uncertainties about this outlook have increased,’’ the Federal Open Market Committee said in the statement following a two-day meeting in Washington.Bullion for immediate delivery rose 1% to settle at $1,360.38 an ounce, the highest closing price since August 2016.To contact the reporters on this story: Joe Richter in New York at firstname.lastname@example.org;Marvin G. Perez in New York at email@example.comTo contact the editors responsible for this story: Luzi Ann Javier at firstname.lastname@example.org, Joe Richter, Steven FrankFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Investing.com - Gold rallied in Wednesday’s post-settlement trading after the Federal Reserve kept the door open for an interest-rate cut further down the road.
Investing.com - Official government data released Wednesday showed a larger-than-expected fall in U.S. crude inventories, sparking a turnaround in oil prices.
Investing.com - Gold prices were unchanged on Wednesday in Asia as traders await the conclusion of the Federal Reserve’s two-day meeting.
Investing.com - Oil prices edged up on Wednesday in Asia following reports that OPEC and its allies are close to agreeing on a date for their next meeting.
During DoubleLine's investor webcast on June 13, Jeffrey Gundlach said, “I am certainly long gold.” His call on gold is based on his expectation that the US dollar (UUP) will finish lower this year.
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Exploring ways to bring material interest to a watch dial is as old as timekeeping itself. And one of the most interesting ways to add face value has been using coins - either as a dial or as the entire case. Rare versions of pocket and wristwatches from Patek Philippe, Vacheron Constantin and Audemars Piguet featuring currencies from the US, Switzerland, France and Mexico have all raised their heads at auction.
Investing.com - Oil prices were lower for a second day on Tuesday, weighed down by worries that global economic growth is being hit by the U.S.-China trade war, although losses were limited by tensions in the Middle East after last week's tanker attacks.
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Investing.com - Gold prices were little changed on Monday, losing steam after five consecutive sessions of gains as investors turned cautious despite expectations for hints at looser policy from the Federal Reserve on Wednesday.
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All eyes will be on the Federal Reserve’s policy announcement on Wednesday, where any hint of waning patience from policymakers could undermine the Greenback’s recent gains.
Based on last week’s price action and the close at 7504.75, the direction of the September E-mini NASDAQ-100 Index this week is likely to be determined by trader reaction to the Fibonacci level at 7551.00.
Based on last week’s price action and the close at 2894.75, the direction of the September E-mini S&P 500 Index this week is likely to be determined by trader reaction to the Fibonacci level at 2877.75.
Crude oil bulls proved weaker and the strength they attempted to project yesterday, evaporated to a considerable degree. Neither today, they appear any stronger.
The current economic expansion has just equaled with the longest boom in US history. Is that not suspicious? We invite you to read today’s article, which provides you with the valuable lessons from the 1990s expansion for the gold market and find out whether the US economy will die of old age.