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Gold Prices Choppy In Tight Range

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Gold Prices Choppy In Tight Range

Gold seems of have stanched the bleeding after Friday's much higher than expected non-farm payrolls report. Prices are choppy in early trading to start the week, but holding in a tight range of approximately $8. Silver prices are building modestly higher, up around a half-percent.

down

Spot gold lost $25.00 to close at $1,335.40 an ounce,barely above the daily low.  Spot silver was down a big 65 cents to close down 3.23% at $19.66, near the intraday low. Precious metals futures settled lower on Friday as well. December gold contracts settled $23 lower, to $1,344.40 an ounce, down 1.7%. September silver plunged 62 cents an ounce, losing 3.1% to settle at $19.82.

At 10am in New York, spot gold is up a minuscule 50 cents an ounce (0.04%) at $1,335.90, while spot silver prices are up 11 cents (0.53%) at $19.76.

Friday's big beat on non-farm payrolls isn't the only thing boosting risk sentiment in markets this morning. China's trade surplus also surprised to the upside, growing to a 6-month high. Unfortunately, once you get past the headline, exports fell, but imports fell further. Overall, economists weren't that impressed.

The S&P 500 and Nasdaq both rode the non-farm payrolls higher Friday to close at record highs. The Dow and Nasdaq closed up more than 1% on the day, while the S&P gained nearly 9/10 of a percent. For the week, the Dow recorded a 0.6% gain. The S&P 500 rose 0.4% for the week, and the Nasdaq finished the week 1.1% higher.

stack-of-100-dollar-bills

The big non-farm payrolls beat was also the wind beneath the wings of the US dollar Friday. The NFP put the possibility of a September interest rate hike by the Fed back on the table, another bullish factor for the greenback. There is no sign of dollar demand diminishing soon, as a dollar liquidity crunch is hitting foreign markets.

Rate hike expectations muted demand for Treasuries, causing yields to rise. The 10-year T note gained 9 basis points to 1.59%. Someone didn't bother to tell investors in Japan and Europe, as currency-hedged yields on the 10-year US bond is now below zero.

Oil futures are much higher this morning, on news that OPEC members will conduct a behind the scenes meeting next month at the International Energy Forum in Algiers. Crude futures recovered from losses early in the week to post gains, with Brent outperforming WTI on a weekly basis by 1.7% to 0.5%.

 

The opinions and forecasts herein are provided solely for informational purposes, and should not be used or construed as an offer, solicitation, or recommendation to buy or sell any product

About the Author

Everett Millman

Steven Cochran

Precious Metals Market Analyst
BS University of South Florida (2002)

A published writer, Steven's coverage of precious metals goes beyond the daily news to explain how ancillary factors affect the market.

Steven specializes in market analysis with an emphasis on stocks, corporate bonds, and government debt. He writes a monthly review of the precious metals markets for SurvivalBlog.com.

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