Precious Metals Steady Owing To Risk Averse Trading ActivityRisk-averse trading activity ahead of key political events has helped yellow metal hit one-month highs.
Precious metals trade positively in the broad market supported by cautious investor sentiment and weak US Dollar in the broad market. Despite prevalent risk appetite in the broad market across last week, cautious investor sentiment ahead of Sino-U.S trade talks scheduled to occur later this week underpinned demand for precious metals which are considered as safe haven assets. And these assets being denominated in US dollar received a bullish boost on Friday when news hit the market that US Fed is planning to stop shrinking its balance sheet which caused sharp sell-off of US dollar in the broad market. This move helped Yellow metal breach critical resistance level of $1300 per ounce for the first time in last 7 months.
Renewed Demand From China Helped Limit Downside Move For Crude Oil
Further, as the trading session opened for the week, while risk appetite seemed high initially in the broad market owing to cues from US wall street, cautious investor sentiment returned ahead of tomorrow’s Brexit vote, Sino- U.S. high-level trade talks and Fed meeting later this week. This cautious sentiment resulted in most major risk assets turning range bound and trading with slight bearish bias boosting demand for safe-haven assets in the broad market. This prevalent safe-haven demand helped yellow metal hit new highs in spot market earlier today at $1301.410 per ounce, the highest since 15th June 2018. Gold is now showing signs of consolidation before building further momentum and as of writing this article, spot gold XAUUSD is trading at $1301.61 per ounce down by 0.14% on the day while US gold futures GCcv1 is trading at $1300.40 per ounce up by 0.17% on the day.
Meanwhile, Silver also saw positive price action in the spot market and hit three weeks high earlier in the day at $15.814 per ounce post which it has displayed signs on consolidative price action. As of writing, spot silver XAGUSD is trading flat at $15.74 per ounce up by 0.01% on the day. Crude oil price is experiencing a sharp bearish nosedive since the trading session began for the day. The decline was supported by news that U.S. energy firms added rigs for the first time his year and on Sino-U.S. trade war worries which are expected to keep economic activity in China relatively low. However, reports that suggested demand for oil in China is rebounding owing to independent refiners choosing to restock while trade war is at an impasse helped limit further declines. As of writing this article, spot US crude oil WTIUSD is trading at $52.56 per barrel down by 1.39% on the day.