Gold Sees First Forgettable Weekly Gain Since Losing $ 1,900 Perch By Investing.com


By Barani Krishnan

Investing.com – Gold clinched on Friday its first weekly gain in four and since its unceremonious fall from $ 1,900 levels. But the difference was hardly something for longs in the yellow metal to crow about.

on New York’s Comex settled at $ 1,777.80, up just $ 1.10 or 0.1% on the day. The gain on the week was slightly less anemic, at $ 8.80 or 0.5%.

It was a woeful previous three weeks for gold longs who watched miserably as the benchmark futures contract in gold cascaded from five-month highs of just over $ 1,919 to a seven-week low of just above 1,761 at one point. That was a loss of almost $ 160 or more than 8%.

In Friday’s trade, the hovered at $ 1,779 late afternoon in New York. Traders and fund managers sometimes decide on the direction for gold by looking at the spot price – which reflects bullion for prompt delivery – instead of futures.

Conviction has become a rare commodity in gold as the average long investor tried to stay true to the yellow metal through its works of the past six months.

Since January, gold has been on a tough ride that actually began in August last year – when it came off record highs above $ 2,000 and meandered for a few months before stumbling into a systemic decay from November, when the first breakthroughs in COVID-19 vaccine efficiencies were announced. At one point, gold raked a near 11-month bottom at under $ 1,674.

Almost becoming a joke as well is the argument that gold was an effective hedge against inflation, or the best store of value in times of financial or political troubles.

The key US inflation gauge monitored by the Federal Reserve rose for a third month in a row in May while personal income and consumer sentiment fell, according to data on Friday that demonstrated growing price pressures against weaker buying from Americans.

Cumulatively, that did bunk for gold, as most data on inflation and other insecurities have over the past few months.

“Gold will likely continue to stabilize going forward as the majority of Fed Chair Powell’s policymakers agree with him that inflation will be transitory,” Ed Moya, analyst at online broker OANDA, said.

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