Gold down as raw commodity sector shudders amid crude oil collapse

April 21, 2020

New York (Apr 21)  Gold and silver futures prices are trading lower in midday U.S. trading Tuesday, but up from their two-week lows scored earlier in the day. The unprecedented total collapse in crude oil futures prices early this week has buyers in most commodity markets, including the metals, scrambling for cover. June gold futures were last down $20.10 an ounce at $1,691.00. May Comex silver prices were last down $0.694 at $14.92 an ounce.

The question for gold traders is how long their metal will follow raw commodity sector leader crude oil before shifting back into its status as a safe-haven asset. Recently it seems one day gold leans one way and the next it leans another. Still, the gold bulls possess the firm overall technical advantage on the charts, suggesting more upside price action, but mixed with some backing and filling.

Global stock markets were mostly lower in overnight trading. U.S. stock indexes are solidly lower at midday. This is a busy week for U.S. corporate earnings, which are reminding traders and investors of debilitating effects of the Covid-19 pandemic, even as some parts of the North American economy may be set to reopen soon.

The important outside markets today see June Nymex crude oil futures down $8.70, or 45%, at $11.85. The U.S. dollar index higher today on safe-haven demand. The 10-year U.S. Treasury note yield is trading around 0.57% today—well down from levels seen recently and a sign of “flight to quality” amid higher anxiety in the marketplace at present.


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