Gold hovered around the $1,480-an-ounce mark on Tuesday, consolidating in the wake of last week’s “phase-one” U.S.-China trade deal.
Gold for February delivery GCG20, -0.05% on Comex fell by 30 cents, or 0.02%, to $1,480.20 an ounce. March silver SIH20, -0.31% shed 3.8 cents, or 0.2%, to $17.075 an ounce, while March copper HGH20, +0.05% was little changed at $2.812 a pound.
The trend in gold, silver, copper, and the U.S. dollar index around Christmas and New Year’s Day “should be taken seriously,” said Chintan Karnani, chief market analyst at Insignia Consultants. “Lack of trading volumes or thin-markets reasoning can cause short term trading losses and short term investment losses.”
For now, traders are long in gold “over progress of [President Donald] Trump and his impeachment related news,” said Karnani, who believes that “impeachment news is the only news which can result in spot gold breaking past $1,500.”
Gold lost ground Monday as it lost its haven appeal in the face of a run to another round of records by major U.S. stock indexes. Appetite for riskier assets was spurred after the U.S. and China on Friday announced an agreement on a preliminary trade deal.
“Gold is holding its own in the current market environment characterized by high risk appetite…One supporting factor is probably the U.S. dollar, which depreciated somewhat yesterday,” said Daniel Briesemann, commodity analyst at Commerzbank, in a note.
A weaker U.S. dollar can be a positive for commodities priced in the currency, making them less expensive to users of other currencies. The ICE U.S. Dollar Index DXY, +0.16%, a measure of the currency against a basket of six rivals, was up 0.2% at 97.169 in Tuesday dealings.