Gold rebounds after biggest drop
Gold is starting to rebound after the market was hit by a sharp correction over the past two days that cut short a record-breaking rally. After being depressed by a total of around 13% in two days, market participants are starting to re-enter at the bottom—and silver is also moving higher.
In the Asian session, spot gold rose as much as 2.2% and re-penetrated the $4,760/ounce area. This gain came after gold fell nearly 5% in the previous session, extending Friday's decline, which was its steepest decline in more than a decade.
Silver also "rebounded," rising around 3.7% to above $82. Previously, the white metal had fallen around 7% on Monday and even recorded an extreme intraday decline on January 30—indicating that volatility remains high and the market has not yet fully calmed down.
Overall, last month's rally was indeed overheated. Investors bought gold and silver due to a combination of geopolitical issues, concerns about currency weakness, and the issue of central bank independence. However, when the US dollar recovered and market positioning became overcrowded, profit-taking and position unloading accelerated the correction.
The key to the next direction lies in the response of Asian buyers—particularly China. "Buy the dip" interest is said to have emerged ahead of the Lunar New Year shopping season, including in Shenzhen. Chinese markets will also be closed for more than a week starting February 16, which could impact liquidity and trading rhythm.
At 7:51 a.m. Singapore time, gold was up 2.2% to $4,763.95/ounce, while silver rose around 3.6% to $81.15. Platinum and palladium also strengthened. Meanwhile, the Bloomberg Dollar Spot Index remained relatively stable after the previous session's 0.3% gain—giving precious metals some breathing room. (alg)
Source: Newsmaker.id
