Gold Consolidates and Holds Steady In Light Of Soaring Equities

April 20, 2017 - 6:02pm

 by Gary Wagner

Gold prices are holding steady considering the dynamic upside swing witnessed today in U.S. equities. The Dow Jones Industrial Average is trading a full percentage point higher on the day. As of 2:55 Eastern Standard Time it is trading at 20,611, up 207 points on the day.

Considering that the all-time high with the Dow is approximately 21,200, today’s impressive rally does not challenge that record. However, it’s a different story when we look at the NASDAQ index. The NASDAQ composite is currently trading at 5922.39, which is a 59.60 gain (+1.01 %). If the index closes here or higher, market participants will witness this index closing at a new record high.

It is quite obvious that this risk-on environment does not favor safe haven assets such as gold. Regardless, the precious metals complex is holding steady in regards to gold, with strong upside price advances in both platinum and palladium. Silver is the only precious metal to close lower on the day.

Palladium and Platinum Prices Move Towards Parity

Palladium gained $26 today to close at 802, a 3.35% increase. Platinum gained 1.3% on the day, a $12 gain, to close at $977. There is now only a $175 difference between the two precious metals. Although this occurrence is unusual, we did see price parity between platinum and palladium in November of last year. Both platinum and palladium traded sharply higher today. This comes as a net result of U.S. equities in the tech sector rallying to new record highs.

Mixed Close for Gold and Silver

One interesting aspect of trading today was the fact that silver, which is a highly used precious metal in the industry, did not rally along with platinum and palladium. Rather, silver sold off in trading with the active May futures contract losing almost $.16, closing just above $18 per ounce. Spot gold did manage to eke out a fractional gain of two dollars, currently trading at $1281.44. Gold futures closed unchanged on the day and are currently trading at 1283.40.

Market participants are still wary and cautious about current geopolitical concerns. However, at least for today, the risk-on asset class is certainly being favored over safe haven assets.

Wishing you as always, good trading,

Gary S. Wagner - Executive Producer