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Gold Firms as the U.S. Dollar Slumps
 

Gold

Gold edged up to hit its highest in nearly a week on Thursday as the U.S. dollar slumped, its safe-haven appeal lessened by reduced fears over the near-term impact of Sino-U.S. trade tensions. Spot gold gained 0.2 percent at $1,205.88 per ounce, having hit its highest since last Friday at $1,028.31.

As we said yesterday, the dollar weakened as its safe-haven appeal was lessened after recent strength and the impact of Sino-U.S. trade was priced in the near term. If that trade war actually drags out, receding safe-haven sentiment will also weigh on the dollar. Investors shall closely watch the Federal Reserve’s policy meeting at the end of this month that will determine gold’s future direction.

On chart, gold rose to the 50-day moving average of $1,206, a crossroad for the near-term direction. On trading strategy, investors shall keep bargain-hunting at lows.

Silver

Spot silver increased 0.5 percent to $14.27 an ounce, after touching two-week highs at $14.35. The white metal tracked gold on the same factors. Investors shall closely watch the resistance at $14.5.

 

Dealing Room, ICBC Beijing Branch
                       Qin Gang


(2018-09-21)
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