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Gold Down 2% on Week; No End in Sight to Volatility 

CommoditiesSep 04, 2020 03:13PM ET
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By Barani Krishnan

Investing.com - Gold fell a fourth straight day on Friday, losing 2% on the week and plumbing lows near $1,920 in a slide that raised questions on how much volatility was in store for the metal that hit $2,000 earlier in the week.

“The core bias remains to view this as consolidation in the core bull trend, with eventual new highs expected above $2,075/80, with resistance then seen at $2,300,” Credit Suisse (SIX:CSGN) said in a note. “But, they do not look for a rush back to new highs and believe investors should be prepared for a lengthy sideways phase. Key support for gold stays seen at $1,887/37.”

Gold for December delivery on Comex settled Friday’s regular New York session down $3.50, or 0.2%, at $1,934.30 per ounce. The benchmark U.S. gold futures contract lost $40 over the week from an unexpected surge in the dollar — despite a drop in bond yields from earlier in the week that questioned the greenback’s rally.

In Friday's trade, the Dollar Index was, however, helped by a positive U.S. jobs report for August.  The U.S. 10-Year Treasury note also jumped a whopping 15% on the day, setting the stage for weaker gold prices.

Gold, however, recouped its losses in “after-hours” trade in New York, with the December contract on Comex rising $5.60, or 0.3%, to $1,943.40 by 3:00 PM ET (19:00 GMT). 

The spot price of gold, which reflects real-time trades in bullion, was also higher by the same hour, trading at $1,935.60 to show a gain of $4.59  or 0.2%.

Gold has been beset with volatility since returning to the $2,000 territory on Tuesday for the first time in 10 days. 

For the yellow metal to recapture its “July momentum” which delivered such highs, a new coronavirus stimulus bill might be needed. The Trump administration has haggled for weeks on the size of the bill, which rival Democrats think should be around $2 trillion versus the White House’s plans for a package that might be four times smaller.

On the contrary, the dollar could get stronger if next week’s meeting of the European Central Bank transmitted dovish signals on the euro — the main forex rival to the greenback.

“Another week and another deluge of headlines saying the U.S. government have not agreed on a fiscal deal. The negotiations are still continuing but there has been no word of any resolution any time soon,” said Rajan Dhall at FXStreet. “The market will be interested to find out if the ECB are willing to look at more stimulus.”

 

Gold Down 2% on Week; No End in Sight to Volatility 
 

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Comments (8)
Koko Ishnava
Koko Ishnava Sep 06, 2020 12:34AM ET
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Gold will hit 00 1300 by November
Silverbug 19
Silverbug 19 Sep 05, 2020 12:02PM ET
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As it rises above $2000. Gold is money when money fails
pol fitipaldi
pol fitipaldi Sep 05, 2020 11:05AM ET
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bullish pennant on the daily and weekly charts
Eric Haberman
Eric Haberman Sep 04, 2020 3:45PM ET
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gold will be 1100 before 2500
Edward Chong
Edward Chong Sep 04, 2020 3:45PM ET
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haha u must be alice brother. alice in wonderland.
Kitty Monkey Lisa
Kitty Monkey Lisa Sep 04, 2020 3:45PM ET
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yes i believe it could, anything is possible.
Mike Brarey
Mike Brarey Sep 04, 2020 3:45PM ET
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totally plausible
Andrew carson
Andrew carson Sep 04, 2020 3:45PM ET
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11000 maybe
Geta Temesgen Achiko
Geta Temesgen Achiko Sep 04, 2020 3:42PM ET
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Good
Thiago Henri
Thiago Henri Sep 04, 2020 3:22PM ET
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nice article thanks for posting :)
humayoun nabi
humayoun nabi Sep 04, 2020 3:21PM ET
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eventually silver and gold will go up...
Thomas Issah
Thomas Issah Sep 04, 2020 3:21PM ET
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Silver and gold would drop😏
Munna Live
Munna Live Sep 04, 2020 3:20PM ET
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Gold will down more?
Vishu Editz
Vishu Editz Sep 04, 2020 3:20PM ET
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50-50 Bro?
Vishu Editz
Vishu Editz Sep 04, 2020 3:20PM ET
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yeah but not confirm
Thomas Issah
Thomas Issah Sep 04, 2020 3:20PM ET
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yes
 
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