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Gold Falls After 1 Day Rally

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Gold fell, paring gains from the biggest one-day rally in more than a year, as a stronger dollar curbed demand for the metal as a protection of wealth. Silver and platinum dropped.

The Bloomberg Dollar Spot Index rose for the third time in four days, extending gains before employment data this week that analysts said will show the U.S. economy added more than 200,000 jobs for the 10th consecutive month in November. Lower oil prices also weighed on gold prices amid concerns about deflation.

“If the dollar holds on to its recent gains, gold is likely to face headwinds ahead,” Abhishek Chinchalkar, an analyst at Mumbai-based AnandRathi Commodities Ltd., said in a note today.

Gold for February delivery dropped 1.9 percent to $1,195.10 an ounce by 7:18 a.m. on the Comex in New York. Bullion for immediate delivery slipped 1.4 percent to $1,195.50 in London, according to Bloomberg generic pricing.

The metal jumped 3.6 percent yesterday, reaching a one-month high. It rebounded as crude oil reversed a drop to the lowest in five years and as some investors closed out bets on lower prices.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza

@alfonso_forex

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