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Gold down on technical trading

Xinhua, December 31, 2016 Adjust font size:

Gold futures on the COMEX division of the New York Mercantile Exchange fell on Friday as the precious metal hit a key resistance level and went back down.

The most active gold contract for February delivery fell 6.4 U.S. dollars, or 0.55 percent, to settle at 1,151.70 dollars per ounce.

The feature of the day was a return to normal trading levels for the precious metal as the short-covering observed in previous days came to a close and eliminated the support from that short-covering.

Despite the fall in the price of gold, the U.S. Dollar Index fell by 0.3 percent to 102.34 as of 1845 GMT. The index is a measure of the dollar against a basket of major currencies. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

Gold was given further support as the U.S. Dow Jones Industrial Average fell by 96.57 points, or 0.49 percent as of 1845 GMT. Analysts note that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.

Trading activity and news releases remains at lower as most of the U.S. remains in the week between Christmas and New Years. Traders are looking to next week for another shortened trading week with the markets closed on Monday, then release of the Institute for Supply Management's manufacturing index on Tuesday, ADP employment report on Wednesday, weekly jobless claims on Thursday, and the big jobs report and international trade report on Friday.

Silver for March delivery fell 22.9 cents, or 1.41 percent, to close at 15.989 dollars per ounce. Platinum for April delivery rose 3.3 dollars, or 0.37 percent, to close at 905.70 dollars per ounce. Endit