This post was originally published on this site
Gold futures headed lower on Monday, as stocks and the U.S. dollar made some tentative steps higher, against the backdrop of rapidly moving developments in the COVID-19 pandemic and as President Donald Trump extended guidelines intended to mitigate the disease’s spread.
Some commodity experts were betting that gold would see momentary resistance in price due partly to difficulties obtaining the commodity and coronavrius-sparked metal refinery closures, which would ordinarily lift prices. Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said in a Monday research note, while arguing that gold could see gains in the longer run.
Gold for April delivery GCJ20, +0.25% on Comex was down $10.20, or 0.6%, at $1,643.90 an ounce, after the metal on Friday marked the biggest weekly rise since September 2008, according to FactSet data.
May silver SIK20, -1.78% dropped 38 cents, or 2.6%, to $14.160 an ounce, following a weekly climb of more than 17% — the largest weekly rise since April 1987.
Markets were digesting a Sunday news briefing where President Donald Trump extended social-distancing guidelines through April 30. The president last week had indicated a desire to begin lifting restrictions by Easter Sunday, on April 12.
“Gold is relatively stable this morning, seemingly having found its feet in the $1,600-1,640 range,” wrote Craig Erlam, senior market analyst at Oanda, in a daily research note.
Erlam said that gold’s propensity to see sharp selloffs of late may limit further near-term gains.
“While I don’t doubt its long-term safe-haven credentials, this is still a market prone to sharp selloff’s which continue to negatively impact gold,” he said,” This will continue to undermine its bullish case even if it wouldn’t be in doubt in normal time, Erlam added.
Meanwhile, the U.S. dollar also was creating some friction for bullion prices. The buck was up 0.8% against a basket of a half-dozen currency rivals, as measured by the ICE U.S. Dollar Index DXY, +0.84%. A stronger dollar can be a weight on commodities priced in the unit, making them more expensive to users of other currencies.
