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Gold shoots up in short covering on last trading day of quarter

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Investing.com - Gold prices shot up on Friday as short covering marked the last trading day of the quarter and allowed for choppy trading.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery were up 1.12% at USD1,225.15 a troy ounce in U.S. trading on Friday, up from a session low of USD1,180.35 and down from a high of USD1,228.55 a troy ounce.

Gold futures were likely to find support at USD1,180.35 a troy ounce, the earlier low, and resistance at USD1,300.55, Monday's high.

Short covering sent gold soaring, as the yellow metal has plummeted 24% during the second quarter of this year.

Uncertainty as to when the Federal Reserve begins to taper monetary stimulus measures has repelled investors away from the precious metal, which benefits when monetary policy is loose due to its role as a hedge to a weakening dollar.

Elsewhere, the Thomson Reuters/University of Michigan consumer sentiment index rose to 84.1 for a final reading in June, up from a 82.7 reading the previous month and also above expectations for a 82.8 reading.

The upbeat numbers came in wake of a report that revealed that the Chicago purchasing managers' index fell to 51.6 this month from 58.7 in May, exceeding expectations for a decline to 56.0.

Any reading over 50 signifies expansion, which left investors at ease to seek out dollar positions.

Also in the U.S., Federal Reserve Governor Jeremy Stein suggested earlier Friday that asset purchases may begin to taper in September provided the economy improves, which further boosted the dollar though gold erased earlier losses and rose on Friday.

Elsewhere on the Comex, silver for September delivery was up 5.15% at USD19.508 a troy ounce, while copper for September delivery was up 0.03% and trading at USD3.060 a pound.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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