Investing.com – Gold prices settled up for the first time in three days on Wednesday before retreating into negative territory, nodding to what could be the Fed’s last hurrah in cutting rates for 2019.
Gold’s settlement and eventual trading at the key $1,500 bullish mark could leave the yellow metal vulnerable to a new round of selloffs as investors seem to be rediscovering their risk appetite. Gold and other safe havens had floundered in recent days as U.S. stocks rallied, pushing the S&P 500 to record highs .
U.S. gold futures for December delivery settled up $6, or 0.4%, at $1,496.70 per ounce before the Fed announced that it had cut rates by a quarter for a third-straight time this year, since an easing cycle that began in July. In post-settlement trade, the December COMEX gold contract was down $1.20, or 0.1%, at $1,488.75 by 2:35 PM ET (18:35 GMT).
Spot gold, which tracks live trades in bullion, was down $5.85, or 0.4%, at $1,481.92.
If COMEX gold doesn’t rebound from Wednesday’s settlement, it could end the week down 0.6%. But it’s still up for the month and year, showing a 1.6% gain for October and 14% rise for 2019.
COMEX gold’s hold under $1,500 followed the Fed’s release statement, which gave few clues about further easing.
Unless the Fed signaled that it was not done cutting rates for 2019, this “could continue to keep dollar index higher and lower buyers’ appetite” for gold, said George Gero, precious metals analyst at RBC Wealth Management in New York.
“Look for continued range-bound prices of $1,485 to $1,525 for gold as the market gets tossed about headlines on U.S. politics, Turkey, Argentina, Venezuela and, most lately, Chile,” Gero added.
Chile announced on Wednesday it had canceled a November meeting of the Asia Pacific Economic Cooperation council and extended a state of emergency to several cities across the country as it grappled with nationwide protests sparked by a proposed hike in public transport fares.
The cancelation of the APEC summit had initially boosted gold prices as stock prices fell and more investors took refuge in the safe haven.
But offsetting some of that positive impact to gold was a Bloomberg report later that said the United States still planned to sign its partial trade pact with China in November despite the cancelation of the summit, which was supposed to provide the original venue for the deal.
Gold’s rally this year was partly underpinned by anxieties over the trade war. White House spokesman Hogan Gidley said in an e-mail on Wednesday that President Donald Trump intended to conclude the partial trade deal with his counterpart Xi Jinping at about the same time in November as the originally scheduled APEC.