The price of gold futures for December delivery on the New York Mercantile Exchange rose 4.90 US dollars and closed at 1,951.70 US dollars per ounce, the highest closing price since September 18. This week, gold futures prices have risen by 3.8%, the biggest weekly increase since July 31.
U.S. stock technology stocks suffered “Black Friday”. On Friday, Eastern Time, the three major US stock indexes closed down collectively. The Dow once fell more than 500 points. The Nasdaq’s biggest intraday drop exceeded 3%, and the late decline narrowed.
In the European market on Friday, U.S. crude oil futures prices fluctuated down by about 1% and traded at around $ 40. A strong U.S. dollar impacted oil prices. In addition, the market was worried that the surge of new coronavirus pneumonia cases in Europe and the United States would reduce these two in the world’s largest fuel-consuming regions.
On Friday (October 16), most of the US dollar fell against G-10 currencies. Previously released data showed that US retail sales grew faster than expected, and consumer confidence rose slightly in early October. The pound is stable as traders still have hope for the prospect of a trade agreement between the UK and the EU, and the two sides will continue negotiations next week. SEK and CAD led G-10 currencies.
The US Commodity Futures Trading Commission (CFTC) on Friday released a report, as of October 7 to October 13 the week: AUD see more willingness to cool; to see more gold willingness to cool down, gold speculative net longs decreased by 7,916 contracts to 240,671 contracts, indicating that investors’ willingness to be bullish in gold has cooled.
On Thursday, the US stock markets fell for the third consecutive day, but the decline was significantly narrowed towards the end of the trading session. The European region tightened lockdown measures to control the coronavirus pandemic to suppress market sentiment.
On Tuesday, the positive correlation between the U.S. dollar and U.S. stocks may be interrupted this quarter due to the decline in its attractiveness as an arbitrage currency and possible fiscal stimulus. Data from the past 10 years show that the US dollar index rose by an average of about 1.7% in the fourth quarter.
In the past week, spot gold fell by more than 100 US dollars, and spot silver plummeted by nearly 15%. The market logic is very clear, that is, the liquidity panic in the context of the global epidemic, especially the worsening epidemic in Europe, the dollar index rose sharply, hitting two months high.
On Friday (September 25), after some people predicted that the dollar would weaken throughout the summer, the dollar recovered this week. It is currently up 0.26% to 94.61. It is expected that this week will have a more than a 2% increase. The biggest five-day increase since April. The technical picture shows that more gains are coming.
Shortly after the Chinese yuan’s exchange rate against the US dollar fell “breaking seven,” US Treasury Secretary Steven Mnuchin issued a statement saying that the US government determined that China is manipulating the RMB exchange rate. This is the first time in 25 years that the United States has listed China as a currency manipulator.
- Interest Rates: The 10-year Treasury is hitting around 2.08%, down from 3.25% just three months ago.
- Oil is down around $53 per barrel. Down from about $65 in April.
- Industrial Production has hit multi-year lows.
- Gold and the dollar are moving up.
These four indicators have many forecasting both a tougher time ahead and a rotation into safe havens. The central focus of concern is the trade wars with China and the new tariffs with Mexico.
- A popular measure of the strength of the U.S. dollar is inching toward its highest level in almost two years, having carved out gains in the past two months. As the greenback marches higher, analysts who predicted its rise in the first quarter, have turned more bearish on bucks, making the case that “the top is in” for the U.S. dollar.