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Precious Metals Trade Positive On Weak US Greenback

By:
Colin First
Published: Mar 18, 2019, 12:42 UTC

Gold trades positive on weak USD and safe haven demand stemming from Brexit uncertainties.

Precious Metals Trade Positive On Weak US Greenback

Precious metals are trading positively today despite a high level of risk appetite as US Dollar in which the metals are denominated is trading weaker in the global market. Concerns surrounding Brexit uncertainties also added to demand surrounding safe-haven assets in broad market underpinning precious metal bulls since the trading session started for the day. A weak dollar is always good news of Dollar denominated precious metals as it boosts participation from investors who hold other currencies owing to the prospect of a lower exchange rate. And given the current scenario where two most followed geopolitical events which dictate price action in the global financial market continues to remain far from being resolved investors continue to look at safe haven options for protection of investments.

Crude Oil Trades Rangebound on Mixed Cues

Gold and Silver are also seeing some level of increased demand in physical markets as its marriage season in India – a period of time frame when there is high demand for Jewelry and wholesale traders are active in replenishing their stockpile to make the best of increased retail demand. These factors have led to yellow metal moving back above $1300 handle which is considered as a critical price level. Dovish Fed expectations are likely to keep weighing US Greenback in the broad market and declining US T.Yields also adds some level of dovish pressure on USD. This suggests that USD is likely to remain dovish in immediate and near future trading sessions which support the possibility of positive price action in precious metals market for the rest of the day and in trading sessions to come ahead of US Fed update.

As of writing this article, Spot gold XAUUSD is trading at $1305.20 per ounce up by 0.23% on the day while US gold futures GCcv1 were trading at $1304.70 per ounce up by 0.13% on the day. Meanwhile, spot Silver XAGUSD is trading at $15.35 per ounce up by  0.39% on the day. Crude oil is seeing range-bound price action today and saw significant downside move earlier in the day owing to concerns of the economic slowdown which weighed down crude oil bulls last friday saw linger influence in the early Asian session. But OPEC supply reduction plans and supply disruption from Venezuela continue to underpin crude oil bulls resulting in crude oil price seeing positive momentum in the spot market in European market hours. As of writing this article, spot US crude oil WTIUSD is trading at $58.56 per barrel up by 0.26% on the day.

About the Author

Colin specializes in developing trading strategies and analyze financial instruments both technically and fundamentally. Colin holds a Bachelor of Engineering From Milwaukee University.

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