Gold prices finished lower Tuesday, giving back some of the prior session’s safe-haven driven gains in a round of profit-taking.
Gold for April delivery GCJ20, -0.42% on COMEX fell 26.60, or 1.6%, to settle at 1,650 oz, while March silver SIH20, -0.69% dropped 0.685 , or 3.6%, to 18.191 oz.
Gold advanced 1.7% on Monday to a 7 yr high as investors sold off global equities and moved into traditional safe-haven assets amid worries about the spread of COVID-19 outside of China.
Many participants have the notion that gold is rising only because of the coronavirus. Yes, that adding some drive to its move North. But, the Key drivers are the collapsing real yields, globally. And there is more to come.
Gold’s short-term ability to move above 1,700 and challenge 1,800-1,900 is a growing probability with this price breakout above 1,600. But, looking at at the Key drivers moving gold over the past year and those are growing in its favorability, which easily puts the gold price in striking of record highs this year.
Overall, gold has done well against declines in US Treasury yields and the US stock market.
The pressure on gold now comes from profit-taking on recent gains, with the most recent Commodity Futures Trading Commission data showing a record high in net long speculative gold positions.