Gold Prices Decline in Anticipation of U.S. Labor Data
Gold prices fell in Asian trade on Friday
Gold prices fell in Asian trade on Friday, retreating from recent record peaks in anticipation of key U.S. labor data that is likely to factor into the outlook for interest rates.
Technical Indicator Shows Buying Momentum Diminishing
A key technical indicator for spot gold prices also showed that buying momentum was running dry after a strong run-up through March and early-April.
Safe Haven Demand May Boost Gold
Still, the yellow metal may benefit from increased safe haven demand, especially with the prospect of worsening geopolitical conditions in the Middle East amid saber rattling between Iran and Israel.
Gold Prices Experience a Decline
Gold fell 0.6% to $2,277.10 an ounce after hitting a record high of $2,305.31 on Thursday, while gold futures expiring in June fell 0.6% to $2,295.50 an ounce by 00:03 ET (04:03 GMT), after hitting a record high of $2,325.30 an ounce on Thursday.
Greenback Strength and Hawkish Fed Comments Impact Gold
A recovery in the dollar also pressured gold, as the greenback rose tracking a slew of hawkish comments from Federal Reserve officials.
Gold Shows Signs of Overbought Conditions
Gold’s 14-week relative strength index- which gauges buying and selling momentum for the yellow metal- showed spot prices were well within overbought territory. The RSI rose as high as 82 earlier this week, and was currently at about 74.9- indicating that the yellow metal remained overbought despite Friday’s price losses.
Profit-Taking Expected Ahead of Key Data Releases
The yellow metal had shrugged off recent strength in the dollar and hawkish warnings on U.S. interest rates, as it benefited from increased safe haven demand on tensions in the Middle East. But traders now appeared to be locking in some profits ahead of key economic data due later on Friday.
Other Precious Metals Experience Decline
Other precious metals also retreated, with silver down 1.1% at $935.60 an ounce, while platinum fell 2.2% to $26.648 an ounce.
Copper Prices Witness Profit-Taking
Among industrial metals, copper prices saw some profit-taking on Friday after surging to 15-month highs earlier this week. The red metal was boosted by positive economic readings from top importer China, as well as the prospect of tighter supplies in the coming months.
Market Awaits China Economic Data for Copper Cues
Both contracts remained close to 15-month peaks hit on Thursday. Markets were now awaiting economic data from China, due next week, for more cues on the world’s largest copper importer.
