Gold snaps 3-day climb as dollar and yields edge up

“The good news for gold bugs is that gold’s technical and fundamental set up is turning much more bullish,” he said. “We have switched from selling rallies above $1,800 to buying dips below $1,800.”

Investors also parsed a report on U.S. retail sales that came in hotter than expected, with retail sales in June rising 0.6%, compared with consensus forecasts by economists surveyed by Dow Jones for a decline of 0.4%. Excluding auto sales, the retail rise was 1.3% last month, the data show.

Meanwhile, a preliminary reading of the University of Michigan’s index of U.S. consumer sentiment fell to 80.8 in July from a final reading of 85.5 in June, notching the measure’s lowest level since February.

August gold GCQ21, -0.89%   GC00, -0.89% fell by $14, or 0.8%, to settle at $1,815 an ounce, a day after futures rose 0.2% to finish around a one-month high.

Bullion, however, saw a weekly gain of about 0.2% to mark its fourth straight weekly rise, matching its longest such streak since the period ended May 28, FactSet data show.

Trading for gold comes as the 10-year Treasury note TMUBMUSD10Y, 1.311% was hanging around 1.30% and the dollar, as gauged by the ICE U.S. Dollar Index DXY, +0.03%, was up less than 0.1%. For the week, the 10-year yield was around 6 basis points lower, while the dollar was up 0.6% on the week, FactSet data show.

Still, gold has been mostly buoyant as investors fret about the spread of the COVID-19 delta variant and the fitful reopening of the global economy, as well as concerns that U.S. markets are topping out.

“The easy part of the rise is left behind, and now the bulls have to prove that they are serious,” about pushing gold to further gains, said Alex Kuptsikevich, a senior market analyst at FxPro.

“Despite the sustained presence, buyers are acting much more cautiously or simply have less strength,” the analyst wrote. “Fundamentally, the trend was shaped by the soft monetary policy of the major central banks, led by the Fed,” the FXPro researcher wrote.

Indeed, Federal Reserve Chairman Jerome Powell, in congressional testimony this week, said that removing some of the Fed’s stimulus was a ways away as the labor market struggles to rebound from the pandemic.

The central bank chief also described inflation as a short-lived phenomenon that would eventually revert to the mean after a COVID-fueled surge that has been stoked by supply shortages amid spiking demand. His testimony before the Senate Banking Committee on Thursday offered a similar message.

Meanwhile, silver futures for September delivery SIU21, -2.57% lost 60 cents, or 2.3%, to settle at nearly $25.80 an ounce, after 0.5% rise on Thursday. Silver suffered a 1.7% weekly decline, its second in a row.

September copper HGU21, -0.13% settled flat at $4.32 a pound, ending down 0.5% for the week.

October platinum PLV21, -2.87% shed 2.6% to $1,108.50 an ounce, but holding onto a 1.2% rise for the week, while September palladium PAU21, -3.16% fell 3.4% to $2,637.30 an ounce, for a weekly loss of 6.6%.