Gold Trades To New Yearly High As It Flirts With $1300

Gary Wagner  Tuesday June 06, 2017 18:13

A trifecta of geopolitical events on Thursday, along with a weaker U.S. dollar and recent weak U.S. economic data, have all contributed as underlying factors taking gold prices to a new yearly high. 

Today, gold futures traded to an intraday high of $1298.80, taking out the previous yearly intraday high of $1297, which was achieved on April 17. As of 4:00 Eastern Standard Time, gold futures are currently trading at $1296 an ounce, two dollars above the highest closing price so far this year. Now for the second time in 2017, gold prices are flirting with that elusive $1300 per ounce mark.

On Thursday, a cluster of events in both the United States and Europe have been cited as major contributors responsible for gold's recent price advance. Beginning in Europe, the ECB (European Central Bank) has a scheduled monetary policy meeting, which will conclude with a press conference from ECB President Mario Draghi. This event will run in tandem with an election being held in the United Kingdom.

This all occurs leading up to the testimony of James Comey to the Senate Intelligence Committee. The former head of the FBI will speak on his knowledge of the current Russian investigation linked to the U.S. election, as well as his recent firing.

So far this year, gold prices have gained approximately 12%. This run up in gold prices most certainly could continue in the immediate future. As reported in MarketWatch, "Everything is going right for gold with a weaker U.S. dollar against the Japanese yen, and Qatari risk also supporting bulls," said Chintan Karnani, chief market analyst at Insignia Consultants.

As reported by CNBC "The uptrend seems intact," said Mitsubishi analyst Jonathan Butler, "It's been helped by the dollar drifting lower and equity markets in the U.S. trading more or less flat."

More importantly, depending on the outcome of these three events on Thursday, gold prices could surge, running past $1300. This could set into motion gold prices running to a new high this year and even challenge last year's high of 1370.

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