Gold Price Slips Near 'Significant Support' as World Warns Trump on Israel Embassy, Brexit Talks Stall

GOLD PRICES slipped near 1-month lows against a rising US Dollar in London trade on Tuesday, drifting back to $1273 per ounce as world stock markets followed Wall Street lower after Monday’s drop.
 
Commodities fell as major government bond prices edged longer-term interest rates higher.
 
“Gold should encounter significant support at $1269/67 and a rebound should follow once these levels are met,” says the latest technical analysis from French investment bank Societe Generale, pointing to the 200-day moving average of Dollar gold prices.
 
Chart of US Dollar gold prices per ounce, last 12 months. Source: BullionVault
 
Gold prices in India – the world’s No.2 consumer nation – today rose to a 6-week high premium above London quotes of $1.50 per ounce according to traders in the key import point of Ahmedabad.
 
Gold premiums in China – the No.1 consumer – held near $7 per ounce on the Shanghai Gold Exchange, below the typical incentive to new imports.
 
Over in Madrid, Spain’s chief prosecutor today cancelled the international arrest warrant for ex-Catalan leader Carles Puigdemont, currently in Belgium ahead of the would-be breakaway region’s new elections on 21 December.
 
The national detention order still stands, however.
 
Over in Manhattan, yesterday’s testimony in the Turkey-Iran sanctions-busting trial of politically-connected Turkish banker Mehmet Hakan Atilla saw the US’s star prosecution witness – former gold trader Reza Zarrab – admit to bribing his way out of jail in 2014.
 
“[Turkey’s] ruling party has an active and effective propaganda apparatus in place,” says columnist Semih Idiz in today’s Hurriyet, and so President Recep Tayyip Erdoğan “will easily be able to survive this affair at home” despite being implicated in the scandal by Zarrab.
 
Atilla’s lawyers argued Monday that prosecutors have hidden key evidence showing that Zarrab will lie to reduce his own sentence.
 
With the Trump administration meantime delaying a decision on whether to move its embassy in Israel from Tel Aviv to the disputed city of Jerusalem, “[We] could go as far as cutting our diplomatic relations with Israel,” Erdoğan today told a parliamentary meeting of his ruling AKP party, calling it a “red line” for Muslims.
 
President of France Emmanuel Macron overnight joined Saudi Arabia in asking the US to avoid heighening regional tensions with such a move.
 
“Any action that would undermine [peace efforts] must absolutely be avoided,” agreed European Union diplomat Federica Mogherini on Tuesday.
 
British diplomats meantime struggled on Tuesday to propose a new solution to the risk of a “hard border” between Northern Ireland and the Republic once the UK leaves the EU, after Prime Minister Theresa May yesterday saw her coalition partners the DUP party reject any plans for Ulster to stay within the EU single market unless the rest of the UK also remains.
 
Irish Prime Minister Leo Varadkar said he was “surprised and disappointed” by the move, which UK opposition politicians called a “damaging embarassment”.
 
Gold prices in UK Pounds recovered Monday’s drop to 5-month lows at £940 per ounce as Sterling fell hard on the FX market.
 
On financial regulation the UK Government wants a “cut and paste of the status quo” post-Brexit said Economic Secretary to the Treasury Stephen Barclay MP to the EU Financial Affairs Sub-Committee today, adding that the City of London has “no appetite” to push for a regulatory “race to the bottom” once the UK leaves the European Union.
 
With US regulators meantime prosecuting a crypto-currency promoter – based in Canada – who raised $15m after promising 13-fold gains in 1 month, regulated futures exchange the CBOE said Monday it will launch Bitcoin contracts on 10 December, one week before competitor the CME’s scheduled launch.
 
“[Bitcoin] is a toxic concept for investors,” said former Morgan Stanley economist and now senior Yale fellow Stephen Roach to CNBC overnight.
 
“Bitcoin is the most vertical of any pattern I’ve ever seen in my career…a dangerous speculative bubble by any shadow or stretch of the imagination.”
 
Prices to buy Bitcoin – a search term now well ahead of ‘buy gold’ according to Google – today neared Sunday’s fresh all-time high above $11,800.

Disclaimer

This publication is for education purposes only and should not be considered either general of personal advice. It does not consider any particular person’s investment objectives, financial situation or needs. Accordingly, no recommendation (expressed or implied) or other information contained in this report should be acted upon without the appropriateness of that information having regard to those factors. You should assess whether or not the information contained herein is appropriate to your individual financial circumstances and goals before making an investment decision, or seek the help the of a licensed financial adviser. Performance is historical, performance may vary, past performance is not necessarily indicative of future performance. This report was produced in conjunction with ABC Bullion NSW.

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