Gold marks its third loss in four sessions as dollar gains, safe-haven rally fades

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Gold futures on Wednesday logged their third loss in four sessions as the safety bid faded after recently carrying gold past the $2,000 per ounce to their highest intraday levels in a year.

Price action
  • The most-active June gold contract

    declined by $5.90, or 0.3%, to settle at $1,984.50 per ounce on Comex.

  • Silver for May delivery 

    rose by a nickel, or 0.2%, to $23.466 per ounce.

  • Palladium for June delivery
    added $22.40, or 1.6%, to $1,437.10 per ounce, while platinum for July
    climbed by $5.50, or 0.6%, to $977.40 per ounce.

  • Copper for May delivery
    gained a fraction of a cent to settle at $4.0865 per pound.

Market drivers

Gold traders looked to book profits Wednesday as futures prices for the metal failed to trade over the $1,990 resistance level, Chintan Karnani, director of research at Insignia Consultants, told MarketWatch.

Also pressuring gold, market analysts pointed out that the U.S. dollar strengthened and banking-sector fears continued to ease.

Risk appetite has been “slowly creeping back into the marketplace this week,” said Jim Wyckoff, senior analyst at, in a daily note. “That’s bearish for the safe-haven metals.”

U.S. benchmark stock indexes traded mostly higher, supported in part by a calmer mood in the banking sector.

“A peaceful interlude has engulfed global markets yet again as investors try to decide if this was a bank crisis that wasn’t or if some real economic worries lie in waiting,” said Stephen Innes, managing partner at SPI Asset Management.

Meanwhile, “[t]he stronger dollar also weighed on gold, which is reversing most of yesterday’s gains,” said Raffi Boyadjian, lead investment analyst at XM.

The ICE U.S. Dollar index
was up 0.2% at 102.66 in Wednesday dealings.

Despite Wednesday’s loss, sentiment is “very bullish” for gold, said Karnani, of Insignia Consultants.

Gold futures trade higher for the month, as well as the first quarter, so far.

A “big increase in the pace of de-dollarization and the banking crisis are the only reasons for the rise in gold price in March and this quarter,” said Karnani, adding that physical gold demand has been rising this year

Traders are “worried over the prospects of more banks getting a rescue,” and focused on the chances for a recession and a pause period in Federal Reserve interest-rate hikes, he said.

Gold prices in the second quarter will be dependent on its ability or inability to trade over $2,000, he said, with the trend for the metal bullish for the quarter as long as it trades over $1,850.

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