Prices of gold, and other precious metals, fell on Wednesday due to stronger U.S. yields and national currency. The decline comes on the backdrop of expectations of new interest rate increases next month amid persistent inflation in the United States and elsewhere.
Gold prices dropped more than 1% on April 19 on higher U.S. yields and a more expensive dollar, with a number of investors now convinced that the United States Federal Reserve is likely to postpone a pause in interest increases.
Spot gold was down 1.7% at $1,970.31 per ounce by 12:00 GMT, while U.S. gold futures were down 1.9% to $1,982.20, Reuters reported. Gold was trading below its 21-day moving average of around $1,990. At the same time, silver dropped 1.9% to $24.73 per ounce while platinum was down 1.5% to $1,066.42.
The decrease in the prices of precious metals was preceded by the rising of benchmark U.S. Treasury yields to an almost one-month high, which increased the value of the U.S. dollar and made gold less affordable for buyers paying with other currencies.
According to Ole Hansen, head of commodity strategy at Saxo Bank, the correction was due to the markets readjusting their expectations of the Fed’s rate-hike path. He predicted that gold will rally again once interest rates peak.
On Tuesday, St. Louis Federal Reserve Bank President James Bullard said that America’s central bank should continue to raise rates amid persistent inflation. Other Fed representatives are also expected to comment ahead of the monetary authority’s decision in May.
Meanwhile, despite the eurozone inflation easing in March, core indicators remain high and members of the European Central Bank’s Governing Council stated that Europeans are likely to see another interest rate increase after their meeting in early May. With the U.K. experiencing the highest inflation in Western Europe, the same can be expected from Bank of England as well.
What are your predictions about gold prices in the near future? Share them in the comments section below.
Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
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Prices of gold, and other precious metals, fell on Wednesday due to stronger U.S. yields and national currency. The decline comes on the backdrop of expectations of new interest rate increases next month amid persistent inflation in the United States and elsewhere.
Gold prices dropped more than 1% on April 19 on higher U.S. yields and a more expensive dollar, with a number of investors now convinced that the United States Federal Reserve is likely to postpone a pause in interest increases.
Spot gold was down 1.7% at $1,970.31 per ounce by 12:00 GMT, while U.S. gold futures were down 1.9% to $1,982.20, Reuters reported. Gold was trading below its 21-day moving average of around $1,990. At the same time, silver dropped 1.9% to $24.73 per ounce while platinum was down 1.5% to $1,066.42.
The decrease in the prices of precious metals was preceded by the rising of benchmark U.S. Treasury yields to an almost one-month high, which increased the value of the U.S. dollar and made gold less affordable for buyers paying with other currencies.
According to Ole Hansen, head of commodity strategy at Saxo Bank, the correction was due to the markets readjusting their expectations of the Fed’s rate-hike path. He predicted that gold will rally again once interest rates peak.
On Tuesday, St. Louis Federal Reserve Bank President James Bullard said that America’s central bank should continue to raise rates amid persistent inflation. Other Fed representatives are also expected to comment ahead of the monetary authority’s decision in May.
Meanwhile, despite the eurozone inflation easing in March, core indicators remain high and members of the European Central Bank’s Governing Council stated that Europeans are likely to see another interest rate increase after their meeting in early May. With the U.K. experiencing the highest inflation in Western Europe, the same can be expected from Bank of England as well.
What are your predictions about gold prices in the near future? Share them in the comments section below.
Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
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Dogecoin saw a five-day winning streak snapped on Wednesday, with today’s drop engulfing recent gains. The meme coin fell by as much as 6% in today’s session, as sentiment in the crypto market shifted. Solana was also lower, plunging by 9%.
Dogecoin (DOGE) plunged on Wednesday, as bears entered the market, snapping a five-day win streak in the process.
Following a low of $0.0853 last Friday, DOGE/USD surged to a peak of $0.0950 during yesterday’s session.
These gains were wiped today, as the meme coin fell to a low of $0.0851 earlier in the day.
One of the main catalysts for the drop seems to be a breakout on the relative strength index (RSI), which fell below a floor at 60.00.
At the time of writing, the index is tracking at 54.98, which is marginally higher than a floor at 53.00.
DOGE has since rebounded, and is currently at $0.08815, however should the RSI continue to fall, the coin could move below $0.0850.
Another notable mover on Wednesday was solana (SOL), which fell by as much as 9% today.
SOL/USD dropped to a bottom at $22.27 earlier in the day, which comes following Tuesday’s peak at $25.22.
As a result of the decline, solana fell to its weakest point since last Tuesday, when the token traded at a low of $20.83.
Like with dogecoin, today’s drop seems to have coincided with a breakout on the RSI indicator, which moved below 57.00.
Price strength is currently at a reading of 53.36, and is fast approaching a lower point of support at 51.00.
If this downturn continues for the remainder of the week, there is a strong possibility that SOL will move below $20.00.
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Is today’s downturn simply a matter of profit capturing? Let us know your thoughts in the comments.
Eliman was previously a director of a London-based brokerage, whilst also an online trading educator. Currently, he commentates on various asset classes, including Crypto, Stocks and FX, whilst also a startup founder.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
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