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Gold gained some ground after Wednesday close of $669.00 – MKS

(OroyFinanzas.com) – Gold gained some ground after Wednesday close of $669.00. The metal continued to rally until the end of the session, bolstered by inflation concerns provoked by high oil prices.

In Europe prices took the opposite direction and slipped slowly. A steady dollar against major European currencies weighing upon prices, gold failed to breach again the $670 technical level. US Jobless claims report came out after the opening of the Comex division of the New York Mercantile Exchange. The data showed that the numbers of US workers signing up for first-time unemployment benefits edged down by 1,000 to a seasonally adjusted 309,000. Economists polled ahead of the report were expecting initial jobless claims to remain unchanged at 310,000 for the week ended June 2. By the mid afternoon prices jumped after the second London fix at $668.75 an ounce and tested the $670 level.

Inventories at US wholesalers rose 0.3 percent in April as stocks of nondurable goods posted the biggest percentage increase in five months, a government report showed. The rise matched economists expectations for a 0.3 percent rise after March’s previously reported 0.3 percent gain. Gold found support in Brent crude prices which were higher, with traders attributing the jump to OPEC’s president saying there was no need for an extraordinary ministers meeting before the group’s scheduled September meeting. Despite this supportive factor market participants seemed to be reluctant to push the metal higher. In the absence of any buying interest the precious metal continued its way on the downside. Stops were hit below$665 followed by $660, eventually bringing us to the low of $658.40. We believe that if the $660 level is not regained there could be further downside potential.

Silver was initially quiet on Tocom however bids took prices up tothe $13.70 levels during the afternoon. The market was capped around$13.74, where prices closed their session. In Europe spot struggled to stabilize above the key level of $13.70 and fixed 5 cents below it. Following exactly the same pattern as gold, spot tumbled during the first Comex hours and then turned around after the release of the wholesales data. The peak of $13.75 was reached followed by a short drop of over thirty cents less than an hour prior to the close.. We believe that the metal might be vulnerable to further correction if gold continues to loose ground.

MKS Gold & Silver, Daily Report
By Moniah El Shikh

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