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Gold Back Near Monthly High’s On Weak US Greenback

Overnight decline in USD price action in broad market and increased physical demand from major markets boost gold price despite increased risk appetite in broad market.
Colin First
Comex Gold
Comex Gold

Gold back near monthly high’s on weak US Greenback in broad market. Despite increased risk appetite in global markets, yellow metal is seeing positive price action owing to increased demand for gold in physical market on weak US Greenback. Subdued USD in broad market usually reflects in emerging markets in form of low exchange rates. Given optimism surrounding trade talks between China & U.S and today’s profit taking activity in major markets following three consecutive sessions of positive price action gold is seeing increased demand on spot and physical markets. Low exchange rate boosts participation from emerging markets. And given current scenario with funds made from profit booking, investors are stocking up on small volumes of gold in spot and futures markets while two of gold’s biggest markets – China & India are seeing increased demand in physical markets as well which is providing significant support to gold bulls in broad market.

US EIA Crude Data Causes Price Decline in Crude Oil Market

Yesterday’s American market hours saw dovish comments from FOMC members which triggered a dollar sell off and greenback was further weighed down by release of latest Fed meeting minutes which stated that majority of FOMC committee members want to slow down pace of rate hike plans for 2019 and a few even wanted to keep interest rate unchanged in December 2018 which influenced great deal of dovish sentiment surrounding US Greenback in broad market. As of writing this article , spot gold XAUUSD is trading at flat at $1293.10 per ounce having hit intra–day high of $1297.12 per ounce well near monthly highs earlier in the day while US Gold futures GCcv1 is trading at $1294 per ounce up by 0.15% on the day. Meanwhile spot silver XAGUSD is trading at $15.70 per ounce down by 0.29% on the day as increased risk appetite in broad market resulted in low demand for silver despite weak USD.

Crude oil price is on slight decline today having climbed more than 4% during yesterday’s trading session. Decline in price action is visible in both spot and futures markets with nearly 1% decline in value by mid-European market hours. Fundamental support for crude oil bulls still remains high in broad market owing to optimism surrounding Sino-U.S trade talks but latest data from US which hints at US Crude oil production remaining near record high at 11.7 million barrels per day as per reports from EIA inspired some level of dovish sentiment resulting in today’s price decline. However spot price for US Crude oil WTIUSD still remains stable above $50 and as of writing, is trading at $51.63 per barrel down by 0.88% on the day.

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