Gold prices rebound after sharp losses; approaches $5.000/oz level
Gold prices rebounded Tuesday, with silver and platinum also advancing, as precious metals seemingly found their levels after two days of outsized losses.
Gold recovers after plummeting from record highs
Gold prices had slumped as low as $4,400/oz on Monday, losing nearly $1,200/oz from a record high hit last week.
Metals were slapped with a heavy dose of profit-taking after U.S. President Donald Trump nominated former Federal Reserve governor Kevin Warsh as the next chairman of the central bank.
While the nomination cleared out a major point of uncertainty for markets, sapping some safe haven demand, Warsh is also seen as a less dovish pick than markets were expecting.
Still, signs of a gold recovery appeared to be in play late-Monday, with spot gold ending well above its intraday lows.
"Further stabilisation will be determined by the mentality of the retail market. Physical demand from this sector has been strong in recent months and could provide a strong backdrop to the selling from leveraged trades in the institutional market," ANZ analysts wrote in a note, while noting that the fundamentals behind gold still remained strong.
"Central bank gold purchases should be strong amid strained international relations, while concerns about Fed independence and rising risk premiums on US assets may add volatility that supports investment demand for gold through 2026," ANZ analysts said.
"Near-term downside risks persist as year-to-date gains are almost fully unwound, and some investors may continue to take profits," said ING, in a note. "But absent a material shift in fundamentals, the pullback looks more like a correction than the start of a new trend. Volatility will remain elevated."
Source: Investing.com
