Investing.com - Gloomy Chinese data ahead of the crucial do-or-die week for the U.S.-China trade deal helped gold prices steady on Monday, despite virtually zero prospects for a Fed rate cut in December.
Palladium, meanwhile, stayed on its record-high path, riding the winds of a global squeeze in the autocatalyst metal.
Gold futures for February delivery on New York’s COMEX settled just 20 cents lower at $1,464.90 per ounce.
Spot gold, which tracks live trades in bullion, was up 85 cents at $1,460.36 by 2:34 PM ET (19:34 GMT).
COMEX gold hit a four-week high of $1,487.65 on Wednesday and spot gold $1,481.90 as investors rushed for a hedge after the Trump administration’s initial indications that the U.S.-China trade deal might be delayed beyond 2020.
Much of that rally was later undone by Friday’s stupendous U.S. jobs data for November, which set investors off again on a risk chase. The huge jobs beat also eliminated almost any chance of the Fed cutting rates for a fourth-straight month when it meets this Wednesday to assess economic growth.
Yet, gold managed to steady on Monday as caution prevailed ahead of the Dec. 15 deadline set by Washington for a trade deal with China.
Without a partial agreement at least by Sunday, the U.S. could impose extra tariffs on a new $160 billion swathe of Chinese goods, including toys and smartphones.
U.S. Agriculture Secretary Sonny Perdue, however, said on Monday the Trump administration might hold off on the additional tariffs after China’s recent move to waive some of its own tariffs on U.S. pork and soy imports.
“Should trade talks make progress and avoid increased tariffs, or even pull back on those currently placed, we could see gold prices wash out as the money leaves safe haven and seeks rising markets,” said Eric Scoles, precious metals strategist at RJO Futures in Chicago.
He said from a technical perspective, COMEX gold appeared to be forming an ominous head-and-shoulders pattern on the weekly chart.
“Should prices violate support and close below $1457, we could be seeing gold at $1,400,” he said.
Palladium, the autocatalyst metal in short supply, hit record highs for an 11th session in a row.
The spot price of palladium was up $3.09, or 0.2%, at $1,880.89 after an all-time high of $1,901.
Palladium futures for March delivery on Comex settled up $10.50, or 0.6%, at $1,856.60, after an all-time peak of $1,868.60.