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TDS: Gold Break Below $1,190 Could Trigger More Selling

Kitco News

Gold could face further pressure if the metal falls below the $1,190-an-ounce area, says TD Securities. As of 8:12 a.m. EST, spot gold was 50 cents higher at $1,200.75 an ounce but has been below $1,200 for the first time since Oct. 11. “Messy European politics, along with a Fed which is set to remain on its tightening trajectory, have kept the dollar index above 97, which continues to add to downside pressure on gold, as we expected,” TDS says. “While CTAs [Commodity Trading Advisers] have now pared back much of their record-setting shorts, we suspect that a break below $1,190/oz would prompt the algos to once again increase their short positioning as downside momentum firms.”

By Allen Sykora of Kitco News;


Commerzbank: Bargain Hunting, Equity Weakness Limit Gold’s Downside

Tuesday November 13, 2018 08:30

Bargain hunting and weakness in equities, such as the sharp fall in U.S. stock market on Monday, are helping put a floor under gold during the metal’s recent slide, says Commerzbank. The U.S. dollar index has climbed to its highest level since the middle of 2017, which is weighing on gold prices. As of 8:15 a.m. EST, Comex December gold was $2 lower to $1,201.50 an ounce and has been below the $1,200 level. The fact that gold has not fallen further “is probably due to the correction on the stock markets yesterday, which has made gold attractive as an alternative investment,” Commerzbank says. “This is also visible from the ETF [exchange-traded-fund] inflows; holdings in the gold ETFs tracked by Bloomberg increased by 5.8 tonnes yesterday. Bargain hunters are also likely to have been taking advantage of the low prices to buy gold, which has presumably also been lending support to the price.”

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