Gold Up More Than 2% As Trump Leads Key States But Gains Are Fragile - Analyst

By Neils Christensen of Kitco News
Tuesday November 08, 2016 21:55

(Kitco News) - Gold is seeing strong 2% gains overnight as the math appears to be supporting Trump in some key battleground states, according to one analyst.

Although it’s too close to call in states like Florida, Ohio, Virginia and North Carolina, Darnin Newsom, senior analyst at Telvent DTN, said that it appears that gold and other markets are front running to get ahead of the results.

“It is getting pretty late in the night for some of these states and it looks like markets are running ahead of the polls,” he said.

December gold last traded at $1,308.60 an ounce, up more than 2.64% on the day.

However, Newsom added that although gold is seeing some early momentum, its gains are fragile as volatility is expected to be extremely high. He noted that although Trump is leading in some battleground states, the evening is still early.

“[Democratic candidate Hillary] Clinton can still pull off a victory and then we can see all these gains wiped out,” he said.

Like many analysts, Newsom said that if Trump ends up winning the race, it is not out of the question that gold prices rally to $1,400 an ounce.

With so much volatlity expected, Newsom has some advice for potential gold traders: "Shutdown your computer, turn off the T.V. and go to bed. Don't try to trade this market."

On the flip side, if Clinton pulls off a victory then gold could eventually fall to $1,211.50 an ounce.