By Barani Krishnan
Investing.com - U.S. and Chinese negotiators are "very, very close" to a trade deal that "could happen fairly soon, or it might not happen at all", according to President Donald Trump. Gold investors, accordingly, aren't sure if they should very quickly send the market back to the lows of $1,300 or keep it hovering where it is now for the next strike higher.
Federal Reserve Chairman Jerome Powell's remarks that dangers continue to brew in a strong U.S. economy also did little for range-bound gold prices.
Investors in palladium, meanwhile, chased prices of the auto-catalyst metal to record highs for a second-straight day on strike threats at South African mines.
Gold futures on the Comex division of the New York Mercantile Exchange settled down just $1 at $1,328.50 per ounce.
Spot gold, reflective of trades in physical bullion, was up 67 cents at $1,328.18 per ounce by 2:30 PM ET (19:30 GMT).
Investors have been using gold as a hedge to the U.S.-China trade negotiations, extending the yellow metal's safe-haven play.
Trump said on Monday he may soon sign a deal to end a trade war with Chinese President Xi Jinping if their countries can bridge remaining differences, saying negotiators were "very, very close" to a deal.
However, he also sounded a note of caution, when he said a deal "could happen fairly soon, or it might not happen at all."
Fed Chief Powell, making the first of a two-day Congressional address at the Senate Committee on Banking, Housing and Urban Affairs, said the U.S. economic outlook was "generally favorable" but still faced challenges from abroad. The central bank, which has said it will be patient in raising interest rates this year after four hikes in 2018, said the size of the balance sheet held by Fed will be ultimately determined by its liabilities.
"The gold market's already discounted news on a U.S.-China trade deal while Powell continues to hold out for surprises with his Capitol Hill appearance," said George Gero, precious metals analyst at RBC Wealth Management in New York.
Palladium extended its premium to gold with Tuesday's rally.
The spot price of palladium was up $16.10, or 1%, at 1,559.05 per ounce by 2:30 PM ET (19:30 GMT), after scaling $1,568.45 earlier to top Monday's peak of $1,539.70.
Futures of palladium settled up $25.20, or 1.7%, at $1,519.70 per ounce on the Comex division of the New York Mercantile Exchange.
Trades in other Comex metals as of 2:30 PM ET (19:30 GMT):
Platinum futures up $7.60, or 0.9%, at $861.20 per ounce.
Silver futures up 2 cents, or 0.1%, at $15.85 per ounce.
Copper futures flat at $2.95 per pound.