Gold futures headed higher on Friday, but the yellow metal was on pace to book a modest weekly decline as a rally in assets considered risky, pushed stocks to all-time highs, helping to undercut some demand for assets perceived as havens.
Overall, however, “the safe-haven metals are faring well despite keener risk appetite that sees the U.S. stock indexes at record highs and a world geopolitical scene that is presently quiet,” said Jim Wyckoff, senior analyst at Kitco.com.
Gold for February delivery GCG20, +0.47% on Comex gained $5.90, or 0.4%, at $1,556.40 an ounce. March silver SIH20, +0.56%, meanwhile, picked up 4.6 cents, or 0.3%, at $17.985 an ounce.
For the week, gold futures are headed for a weekly loss of 0.2%, which would mark the first weekly loss of the year so far, while silver is on track to fall 0.7% from last Friday’s settlement.
“The first two months of the year tend to be bullish for gold from a seasonality perspective,” said Adam Koos, president of Libertas Wealth Management Group. However, some traders who pay attention to seasonality may look to take profit come the end of February, he said.
“So far, the market doesn’t seem to care about the Trump impeachment process, but if the Senate ramps things up in the coming weeks, we could see the fear trade step in and push gold prices higher,” Koos added.
Gold prices traded as high as $1,560.90 Friday, but pared their gain after a U.S. housing report came in at its best level in about 13 years. Housing starts and permits jumped 16.9% to an annual rate of 1.608 million units last month, the highest level since 2006. Consumer sentiment index in January, meanwhile, slipped to 99.1 from 99.3 in December.
Bullion prices have managed to hold above a line viewed as support by technical analyst at $1,550, offering a modicum of optimism for gold bulls.
“The gold markets like gold much more than the risk correlation matrixes do for sure. Indeed, there is demand for all thing’s gold, as evidenced in the sturdy bid around $1550/oz,” wrote Stephen Innes, chief Asia market strategist at AxiTrader, in a daily research report.
“Typically record-setting equity markets and higher gold prices seldom, if ever, can co-exist in the same space, not to mention neither can do much better than expected US economic data,” he said.
Traders also digested readings of expansion for China, which showed economic growth picked up in December. However, growth slowed to 6.1% last year, pulling the closely watched reading to its lowest level in nearly three decades.
Rounding out action on Comex, March copper HGH20, +0.21% traded at $2.849 a pound, up 0.07%.
April platinum PLJ20, +2.34% added 2.6%, to $1,026.70 an ounce, while March palladium PAH20, +3.03% notched fresh record highs, up 3.3% to $2,250.10 an ounce.
“Given a sea of green in global equity markets, mostly positive Chinese economic data (retail sales were strong enough to consider the data positive) and increased media coverage on the stellar gains” in the platinum group metals markets, the bull camp for palladium looks to have a fundamental edge, analysts at Zaner Metals said in a daily note.
Read: Why palladium prices keep hitting new highs and rhodium has already rallied by 30% this year
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