Gold futures fell on Monday, partially due to fresh fears over the spread of the COVID-19 delta variation, amid some strength in the US dollar and a severe global selloff in stocks. According to Ross Norman, chief executive officer of Metals Daily, gold prices have encountered resistance at the 200-day moving average, which he estimates to be about $1,825 an ounce. Prices in Shanghai and India are “sliding to a little discount,” and he believes it will be difficult for gold to maintain any upward momentum.
August gold GCQ21, -0.37 percent GC00, -0.37 percent fell $2.60, or 0.1 percent, to $1,812.40 an ounce, after the metal posted a weekly gain of nearly 0.2 percent on Friday, matching its longest streak since the month ended May 28. According to reports, the highly transmissible delta version of COVID-19 is causing a resurgence of infections in the United States and around the world. Up to 82 million Americans are still unvaccinated or lack COVID-19 antibodies, and there are rising fears that the delta version will hit the economy again. Investors are fleeing to the safety of the dollar, placing some early pressure on gold, which would normally attract haven bids. The ICE U.S. Dollar Index, which measures the buck against a half-dozen major currencies, showed the greenback up 0.1 percent. For foreign buyers, a rising dollar can make assets valued in the currency, such as precious metals, more expensive. In a daily statement, Naeem Aslam, chief market analyst at AvaTrade, stated, “For the time being, we do see additional strength for the dollar index, which is pushing the gold price lower.” According to FactSet data, gold remains above its 100-day moving average of $1,791.17 per ounce, which is a positive indicator for bullish investors, but movements below that level might tip the balance in the precious metal’s favor. The stock market sell-off coincided with the benchmark 10-year Treasury note TMUBMUSD10Y, 1.217 percent, falling below 1.20 percent for the first time since mid-February. Silver futures for September delivery SIU21, -2.27 percent were down 43.5 cents, or 1.7 percent, at $25.36 an ounce, after a 1.7 percent weekly drop on Friday, the second in a straight./n
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