Gold Rallies More than 1 Percent in Rebound
Reuters
Spot gold prices jumped more than 1 percent on Thursday, with technical buying a strengthening euro and hopes for a Fed stimulus to the U.S. economy cited as driving a late-morning recovery in bullion, which had declined in early trade.
As the euro strengthened against the dollar, bullion rebounded from an intraday low around $1,650 per oz. Some market participants said disappointing U.S. jobless claims data fed hopes that the U.S. Federal Reserve would launch a third round of quantitative easing, or QE3.
Other traders said the rally was technically driven and took many by surprise. They noted that gold was outperforming the euro, which was up 0.5 percent against the dollar.
Spot gold was up 1.05 percent at $1,674.86 per oz at 12:37 p.m. EDT (1637 GMT), headed for its largest weekly gain in six weeks as investors have grown more risk averse. Confidence in the euro-zone economic recovery took a knock this week amid concerns mounting about Spain andItaly.
Gold futures for June on Comex were up $20 an ounce at $1,680.30.
Bullion, which had risen as high as $1,675.31, was still within its recent trading range. Traders said they expected it to hit resistance around $1,685 per oz.
One trader said the rebound from early losses was technically driven after gold hit an intraday low of $1,650 per oz, rather than due to any economic data.
Technical buy stops over $1,665 per oz could be behind the rise, George Gero, senior vice president of RBC Wealth Management, said.
"People decided they wanted to get back into the market. People who thought we'd have a back and forth today were on the wrong side. You can search for news, but you'll come up empty handed," he said.
U.S. data disappointed on Thursday, with weekly jobless claims hitting their highest level since January, raising concerns that the job market was stalling.
Spanish bond yields have jumped to nearly 6 percent, a level viewed as unsustainable. Equities are hovering near three-month lows, while holdings of gold in exchange-traded funds, often seen as a measure of longer-term investment appetite for bullion, held near record highs around 70.3 million ounces.
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Gold Rallies More Than 1% on Disappointing US Jobless Claims
Economic Times
Spot gold prices jumped more than 1 percent on Thursday, with technical buying a strengthening euro and hopes for a Fed stimulus to the US economy cited as driving a late-morning recovery in bullion, which had declined in early trade.
As the euro strengthened against the dollar, bullion rebounded from an intraday low around $1,650 per oz. Some market participants said disappointing US jobless claims data fed hopes that the US Federal Reserve would launch a third round of quantitative easing, or QE3.
Other traders said the rally was technically driven and took many by surprise. They noted that gold was outperforming the euro, which was up 0.5 percent against the dollar.
Spot gold was up 1.05 percent at $1,674.86 per oz at 12:37 p.m. EDT (1637 GMT), headed for its largest weekly gain in six weeks as investors have grown more risk averse. Confidence in the euro-zone economic recovery took a knock this week amid concerns mounting about Spain and Italy.
Gold futures for June on Comex were up $20 an ounce at $1,680.30. Bullion, which had risen as high as $1,675.31, was still within its recent trading range. Traders said they expected it to hit resistance around $1,685 per oz.
One trader said the rebound from early losses was technically driven after gold hit an intraday low of $1,650 per oz, rather than due to any economic data.
Technical buy stops over $1,665 per oz could be behind the rise, George Gero, senior vice president of RBC Wealth Management, said. "People decided they wanted to get back into the market. People who thought we'd have a back and forth today were on the wrong side. You can search for news, but you'll come up empty handed," he said.
US data disappointed on Thursday, with weekly jobless claims hitting their highest level since January, raising concerns that the job market was stalling.
Spanish bond yields have jumped to nearly 6 percent, a level viewed as unsustainable. Equities are hovering near three-month lows, while holdings of gold in exchange-traded funds, often seen as a measure of longer-term investment appetite for bullion, held near record highs around 70.3 million ounces.
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China Buying Gold?
MarketWatch
Gold’s rebound puzzles the bugs — but they’ll take it anyway.
It helps to have luck — or something! Michael Gayed’s brave column yesterday, “Was that the bottom in gold?, published just after gold closed with an impressive $16.80 rise in the CME June gold contract, was not followed by an immediate reversal. June gold closed today down only 40 cents, so the gains were held.
In contrast, my own recent cheerful chat about gold was followed by a horrible $57.90 drop in gold the next day.
Of course, I was just reporting what the investment letters say — but I felt bad anyway.
In fact, the important gold-positive news I noted — that the strike by the jewelers in India, the world’s biggest gold importer, appeared to be ending — turned out to be wrong. The strike went on for another week. But it did finally end this past Saturday, after an extraordinary 21 days.
Observers in a position to know, like bullion dealer UBS, say that, while working through the disruptions caused by this unprecedented stoppage will take some time, they have seen demand from India returning.
Since India is in effect the default buyer on a gold downswing, this means critical underpinning is back in place.
But gold bugs were extremely puzzled by Tuesday’s gain. I cannot recollect a move which drew so many frank statements of ignorance from the sources I regularly check.
Of course, that does not influence the chartists. They don’t care why prices move: movement itself impresses them. Bullion dealer ScotiaMocatta’s Technical Commentary on Wednesday noted:
“Gold closed slightly lower today… at 1658. The ability for gold to hold the 1656 level (the 50% retracement of the December to February up-move) and to close above the short-term bearish trend channel, is encouraging for bulls. Gold also clearly rejected the move down below the 61.8% Fibonacci retracement of the same uptrend…”
One hypothesis widely discussed, particularly on the hard-core gold conspiracy site LeMetropoleCafe, is that there is heavy buying by the Chinese, particularly China’s Central bank.
Gold Rallies on Hopes For More Easing
MarketWatch
Gold futures rose on Thursday, getting a boost from a weaker dollar and rising U.S. stocks and as talks surfaced of another round of economic stimulus in the U.S. and elsewhere.
Gold for June delivery rallied $20.30, or 1.2%, to settle at $1,680.60 an ounce on the Comex division of the New York Mercantile Exchange
Other precious and base metals also benefitted, with silver leading gains.
Support was underpinned by a weaker dollar and rising U.S. stocks, analysts said.
Several also pointed out to comments by two Fed officials, William Dudley and Janet Yellen, taken by the market as leaving the door open for more monetary stimulus.
Gold traders are “positioning themselves” on the belief that more liquidity will be injected into the system, with talks of another round of large-scale bond purchasing popping up in the U.S. and China, among other countries, said Adam Klopfenstein, a market strategist with Archer Financial in Chicago.
U.S. stocks rose on the signals interest rates will remain ultralow for the time being, which took some of the sting off a disappointing report on unemployment benefits.
New York Fed President William Dudley on Thursday told an audience in upstate New York the economy is not yet strong enough to make a significant dent in the jobless rate.
Yellen made similarly cautious comments on Wednesday, saying she expects the U.S. will fall “far short in achieving our maximum employment objective.”
Earlier Thursday, the U.S. Labor Department said the number of Americans applying for jobless benefits rose to its highest level in two and a half months, jumping 13,000 to a seasonally adjusted 380,000 in the week ended April 7.
Chinese authorities are slated to release data on gross domestic product on Friday. China has become the center of attention for investors, who fear the commodity-gobbling country’s economy might be slowing down.
Meanwhile, the ICE dollar index, which measures the U.S. dollar against a basket of six currencies, traded at 79.314, down from 79.791 in North American trade late Wednesday.
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