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Gold struggles for direction as dollar gains ground

Gold futures flipped between small gains and losses Monday, struggling to find haven-related buying support as global equities fell in response to rising COVID-19 cases in the U.S. and Europe.

A stronger U.S. dollar, meanwhile, was seen capping gains for the yellow metal.

Gold for December delivery was up $2.80, or 0.1%, at $1,908 an ounce on Comex, while December silver was off 26 cents, or 1.1%, at $24.415 an ounce.

“The great gold consolidation continues, with price holding up relatively well this morning and clinging onto support, despite broader market sentiment turning negative and the dollar making decent gains,” said Craig Erlam, senior market analyst at Oanda, in a note. “This hasn’t been the best combination for gold prices this year but they are showing some resilience in early trade.”

U.S. stock-index futures pointed to a lower start for Wall Street on Monday, with pressure attributed in part to a continued surge in COVID-19 cases, with the number of new U.S. infections hitting a daily record on Friday and European countries imposing tougher restrictions on activity.

Long-running talks toward a new round of aid spending from Washington, meanwhile, have yet to bear fruit.

Meanwhile, the ICE U.S. Dollar Index, a measure of the currency against a basket of six major rivals, was up 0.2%. A stronger dollar can be a weight on commodities priced in the greenback, making them more expensive to users of other currencies.

Source: Marketwatch

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