Gold prices retreated in early Tuesday trading, falling below $4,300. Last week, the precious metal gained more than 6% and extended those gains by hitting an all-time high yesterday. Prices have been supported by ongoing geopolitical turbulence, trade-related tensions, and a prolonged US government shutdown, all of which have enhanced gold’s safe-haven appeal. Growing bets on a dovish Federal Reserve have also been positive for the precious metal, creating headwinds for the US dollar and supporting gold prices due to the inverse correlation between the two assets. Against this backdrop, this morning’s losses reflect more positive signals emerging from Washington regarding ongoing trade tensions with China, which have lifted sentiment in equity markets and diverted flows away from the safe-haven metal, alongside modest dollar gains. However, the path of least resistance still appears to be to the upside, as traders continue to view any price dips as buying opportunities.
Ricardo Evangelista, ActivTrades
Source: ActivTrader
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