Gold price reverses gains as investors look past weak U.S. jobs data

Gold price reverses gains as investors look past weak U.S. jobs data


Gold price eased on Thursday as a failure to significantly breach the $1,850 per ounce resistance level prompted technical selling, with persistent overall vaccine-driven optimism also prompting investors to look past weak U.S. jobs data.

Spot gold fell 0.2% to $1,836.01 per ounce at 11:44 a.m. EST (1644 GMT). U.S. gold futures were up 0.1% at $1,839.90.

“The technical failure above $1,850 has buyers less aggressive. The tourists have mostly gotten out and it feels more like real money re-allocating,” said Tai Wong, head of base and precious metals derivatives trading at BMO.

“Looking ahead, gold is searching for a comfortable range with prospects for a gentler rise overall.”

Further proof of a stalling labor market recovery, data showed that the number of Americans filing first-time claims for unemployment benefits surged last week with the United States in the throes of a fresh wave of infections and resultant lockdowns.

Gold initially rose after the jobs data and a further accommodative stance from the European Central Bank.

In an attempt to aid an euro zone economy suffering due to the second wave of the pandemic, the ECB eased policy again and kept government, corporate borrowing costs at record lows.

But “there was some disappointment with the expectations that they (ECB) were going to extend the programme (by) not nine, but 12 months,” said Edward Moya, senior market analyst at OANDA.

“A lot of investors are more cautious heading into the holidays, you`ll see more erratic moves because we`re not going to have steady volumes,” Moya added.

Gold, regarded as a hedge against inflation has risen over 21% so far this year underpinned by unprecedented stimulus unleashed across the globe in 2020.

Among other precious metals, silver was up 0.2% at $23.96 per ounce and platinum rose 2.4% to $1,024.87.

Palladium gained 3% to $2,333.00.

The story has been taken from a news agency





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