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In trading on Wednesday (28), gold futures prices fell sharply and closed at the lowest point in about a month. The rise of new crown boxes in Europe and America prompted investors to rush to the US dollar and world equity markets fell.
The CEO of “Metals Daily” (Metals Daily), Ross Norman, said: “The first option for hedging is the US dollar. Therefore, the impact of the strength of the US dollar and the need for investors to raise funds to meet margin call requirements have driven down the price of gold. “
The ICE dollar index rose 0.5%. A stronger US dollar can put pressure on commodities priced in US dollars.
But Norman believes that historically, the gold correction “is only a short-term problem. The scale and speed of the gold price recovery in the coming weeks will show the basic attitude of the general public towards gold.”
- The price of gold futures for December delivery fell $ 32.70, or 1.7%, to settle at $ 1,879.20 an ounce, the lowest point since Sept. 25, the most traded gold futures.
- December silver futures prices fell 1.21 US dollars, or almost 4.9%, to close at 23.359 dollars an ounce.
Edward Moya, Senior Market Analyst at Oanda, said: “Due to the turbulent period before the elections, the US dollar took gold out of the ‘stimulus measures’, which is a high-end Malaysia, and investors have sales of panic. “
“In Europe, the severity of the new corona epidemic has worsened the outlook. The European Central Bank has become the focus of attention, causing the euro to fall and the US dollar to strengthen. Investors are more willing to embrace US dollar cash and thus pulled the anti-dollar bets like gold. “
European stocks fell and the US stock market suffered heavy losses due to the new round of lockdown measures implemented by European countries to curb the epidemic. At the same time, the number of new diagnoses in the United States is also increasing.
Jefferies currency analyst Brad Bechtel reported that “the gold trend confirms that it now looks more like a market trend for cash.”
After setting a record 80,000 confirmed cases in a single day last weekend, the number of confirmed cases in the United States returned to more than 70,000 on Tuesday. According to analysis of Johns Hopkins University data by The Wall Street Journal, the number of confirmed diagnoses in the United States dropped to a record 500,000 last week, and the average daily number of new diagnoses in the seven days came. at 69,967 on Monday. Record.
“Once the panic selling sentiment ends, gold will again benefit from the stimulus trading, because the ECB will be forced to do more than previously expected, and the Fed is not far off because some risks are spreading as well. to the credit market. ” Moya said.
Trade in other metallic raw materials
- Copper futures for December delivery fell nearly 1% to close at $ 3.064 a pound.
- The price of platinum futures for January delivery fell 1.3% to close at $ 875 an ounce.
- Palladium futures for December delivery fell 4.4% to close at $ 2,250.60 a pound.
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