Gold falls but after yet another record high
Gold's drop came along with new record highs by precious metals in yesterday's trading session. Gold declined after it managed to achieve another historical new high; recording the highest at 1221.50 in NY, while also recording its highest in electronic trading at $1226.00 per ounce and closing in the end lower by 0.60% at $1207.50 per ounce.
Meanwhile, gold dropped as well in London, as the precious yellow declined from the early fixing which was set at $1218.25 towards $1208.75 in the P.M Fixing; which was accompanied by declines for platinum and silver as well.
Platinum managed to close lower, depreciating by 1.00% to 1482.00 throughout yesterday's New York session, but after recording the highest since August of last year at $1507.00 per ounce; silver, on the other hand, recorded a steep drop by 2.08% and closed at $18.81 per ounce in NY.
Silver claimed the highest drop seen among precious metals, whereas the least losses were for gold. The dollar advanced against the basket of the six major traded currencies, where the index recorded its highest at 74.71; meanwhile, crude dropped yesterday to $75.75 per barrel and encouraged speculation and profit-taking in the market. Reinforcing the previously mentioned heavy drop in silver which was flowed by platinum and finally ending with the least losses for gold; thus, insuring that speculators locked on their profits which were evened by continued haven and investment demand.
On the other hand, a U.S. court decided to halt a project by a giant mining company in Nevada due to environmental related issues, although this standstill seems to be temporary. Adding to that, India's consumer demand has dropped on gold due to the endless surge, which is positioning China closer to take the lead as the world's top consumer. Those facts continue to assure that demand on gold is stronger in terms of investment and haven, as banks and major portfolio managers purchase gold as a hedge against fears of the continued dollar slump, and possibility for others to follow; for instance the Japanese yen has started to fall after reaching its highest, against the dollar, since 1995.
The drop did not only effect stock indices, but we also witnessed commodity indices depreciating; therefore, indicating that the profit-taking wave managed to engulf most financial markets around the world. At the same time, the S&P GSCI index fell by 0.82 points to close at 508.49; whereas the RJ/CBR index closed at 276.55 points with loss by 0.25 points.
Today, precious metals are trading with some positivity and slight gains; gold is trading at $1209.60 per ounce appreciating by 0.17% as of 02:26 EST; whereas silver also gained by 0.43% in a bearish correctional wave yesterday, trading today at $18.89 per ounce; platinum, however, is currently trading within the same range it recorded in yesterday's NY session.
We await the release of vital data from the U.S. labor market which might fuel further volatility in today's session; and despite the bullish medium term outlook, today, we expect massive fluctuations and probable bearish correctional waves due to effects of economic data, and the dollar's direction against major currencies.