Gold price extends losing streak to four sessions
San Francisco (July 14) Gold futures settled lower Tuesday. Disappointing U.S. retail sales data failed to keep prices from extending their losing streak to a fourth straight session.
“Today’s gold price action is a case of the path of least resistance pointing to lower prices,” said Mike Armbruster, principal and co-founder at Altavest.
“Gold is approaching critical support around $1,150 and our expectation in the medium term is that gold is heading even lower,” he said. “Fundamental arguments for a longer-term bull market in gold are strong, but now is not the time to be overweight gold. Gold bugs need to be patient.”
Gold for August delivery on Comex GCQ5, -0.14% fell $1.90, or 0.2%, to settle at $1,153.50 an ounce on Comex — its fourth session loss in a row. Prices had climbed to a high above $1,158 shortly after retail sales data were released, then pulled back.
September silver SIU5, -0.82% gave up 14.2 cents, or 0.9%, to $15.315 an ounce.
U.S. retail sales fell 0.3% in June, versus expectations for a 0.2% rise. The dollar weakened against major rivals after the data, offering some support for dollar-denominated gold, but the ICE U.S. dollar index DXY, -0.15% was down just 0.2% at last check.
Given the fall in retail sales, an increase in U.S. interest rates may be postponed to the first quarter of next year, said Chintan Karnani, chief market analyst at Insignia Consultants. Higher interest rates tend to support the dollar, which can then weigh on prices for gold.
For now, analysts said the dollar will likely continue to hold sway over gold, particularly as fears over China and Greece fade.
Gold and other precious metal prices had slumped over the past month, influenced more by a sharp fall in Chinese stock prices than the turmoil surrounding Greek debt talks, noted Simona Gambarini, commodities economist at Capital Economics.
“The technical outlook and investor sentiment have sharply deteriorated since mid-June, but the potential for further price falls should now be limited,” Gambarini said, in a note.
In other metals trade, October platinum PLV5, -0.87% fell $7.60, or 0.7%, to $1,028.40 an ounce, while September palladium PAU5, -0.82% ended lower, losing $1.85, or 0.3%, to $657.10 an ounce.
September copper HGU5, -0.16% fell about a penny, or 0.4%, to $2.535 a pound.