Good morning, traders. Welcome to our weekly preview of the stories, events, and economic data on our radar this week that could have the biggest impact on gold its correlated markets. With the dominant narrative for global markets still coming out of China at the start of the week, wheels are already turning so we’ll jump right into the coverage.
Gold prices are stuck on the backfoot this morning, trading roughly $10 below last week’s close following a strong gap higher as global markets reopened Sunday evening, and then a steady crush of selling pressure on the yellow metal. Silver has also lost ground, falling back below $18/oz once again.
The weakness in gold this morning is at least partially driven in opposition to strong futures trading in US equities (which are now making gains as the cash market has opened,) and a higher Dollar. This will likely keep risk appetite elevated through the market day as European and US stocks seem to have shrugged-off the ugly post-holiday open for Chinese equities this morning that was wholly expected. The other weight around gold’s neck to begin the week is an immense amount of pressure on the broad commodities index, led by falling oil prices. With the fear levels around the coronavirus outbreak moderating, if not falling, gold’s natural safe have utility just isn’t enough to avoid the selling we’ve seen across all commodities as the health crisis in China is expected to seriously dent demand of raw materials.
Read more of the Gold Price Preview for the week of February 3 – 7 on the GoldPrice.org website HERE