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RBC's Gero: Gold Softer; 'It's Still All About The Dollar'

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A retreat in gold continues in response to a strong U.S. dollar, says George Gero, managing director with RBC Wealth Management. Market participants appear poised to push the dollar index back above 97, Gero says. As of 9:06 a.m. EDT, the spot dollar index was up 0.209 point to 96.788. Comex December gold was down $1.50 to $1,226.10 and earlier traded down to $1,221.40. “It’s still all about the dollar,” Gero says, citing news that there could be more tariff hikes in the trade war with China if a meeting next month between the presidents of the two countries does not resolve the issue.

By Allen Sykora of Kitco News; asykora@kitco.com

 

TD Securities: Trend Followers Could Increase Shorts In Gold If Chart Level Fails

Tuesday October 30, 2018 09:26

TD Securities says Commodity Trading Advisers might start increasing bearish bets, or short positions, if gold falls through certain downside levels. Analysts say “with the U.S. dollar index continuing to firm, CTAs are looking to the downside in precious metals as a break below the $1,213.50/oz range would imply that systematic trend followers would be set to increase their shorts in gold. In platinum, prices will have to close below the $832/oz mark for CTAs to maintain their recently added shorts. That being said, we will continue to keep a close eye on palladium, [which] could be subject to the most significant flow in the complex should prices break below the $1,050/oz range.”

By Allen Sykora of Kitco News; asykora@kitco.com

 

MKS: Gold Move Below $1,225 ‘Cleared Out’ Some ‘Weaker Long Positioning’

Tuesday October 30, 2018 09:26

Gold is softer, with weakness setting in during Asia-Pacific trade in response to a stronger U.S. dollar, with some so-called weak longs – bulls who had just gotten into the market – being cleared out, says MKS (Switzerland) S.A. “The greenback remained elevated throughout the session, while USD/CNH held above 6.97 to see Chinese demand muted,” MKS says. The Shanghai on-shore gold eased toward $6.50 following further dollar/Chinese yuan strength around the fix, MKS says. “The New York test underneath $1,225 has almost certainly cleared out some of the recent weaker long positioning; however, a test underneath $1,220 cannot be ruled out should U.S. equities manage to regain their footing and the dollar remain firm,” MKS says. “Initially we look to $1,230 as a key pivot point, with broad extension to the more important $1,235.” Around 8:52 a.m. EDT, the U.S. dollar index was up 0.275 point to 96.625. Shortly after this, spot gold was $4.50 softer to $1,224.10 an ounce.

By Allen Sykora of Kitco News; asykora@kitco.com

 

Commerzbank: Robust Palladium Prices Not Yet ‘Headache’ For Carmakers

Tuesday October 30, 2018 09:26

High palladium prices do not seem to be causing a “headache” for automobile producers yet, says Commerzbank. Spot metal hit a record high last week. The main industrial use is catalytic converters in automobiles, leaving analysts wondering whether some carmakers might shift to less expensive platinum. “One major U.S. manufacturer reported yesterday that it had no plans as yet to replace palladium with platinum again, explaining that retooling factories is expensive and a long-term decision,” Commerzbank says. “Any such substitution would need to pay for itself over a 1.5- [to] 2-year cycle.” 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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