Fundamental Comment

Gold prices slump from 14-month peak

Gold falls from 14-month peak

Gold prices fell during Monday's trading, retreating from the highest level recorded in 14 months, as the US-Mexico deal cut demand on the precious metal as a safe haven asset.

Prices of the precious metal went down by 1.05 percent to $1,331.95 an ounce, as of 10:17 GMT, noting that at the metal reached its highest level since April 19, 2018, at $1,348.08 an ounce.

The agreement between the U.S. and Mexico would end the US tariffs, which were to be applied to all Mexican imports starting today, thereby easing trade war tensions.  

Investors turned to the possession of risky assets with the calm of trade tensions, with Asia's financial markets rising today as European exchanges also were in green session by mid-day trading.

In the same context, US President Donald Trump has defended the agreement with Mexico in the face of criticism that there were no major new commitments to stem the influx of Central American immigrants into the United States, and said on Sunday that more details will be announced soon.

Investors are looking into any developments regarding the trade situation between the United States and Mexico, with the expectation that the US president will meet with his Chinese counterpart at a G-20 summit.

As for other precious metals, silver fell about 1.59 percent to $14.777 per ounce, platinum settled at $806.28 per ounce and palladium fell about 0.97 percent to $1,342.90 per ounce.

The following technical 4-hour chart, shows that silver offers good buying opportunity at $14.50 as prices breached the wedge classical pattern.    


In the meantime, the dollar index, which measures the greenback’s performance versus six major currencies, rose about 0.30 percent at 96.782.

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