By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch)—Gold futures rebounded Friday from sharp losses in the prior session, bolstered as commodity markets rose and the dollar declined.
Gold futures for April delivery GCJ2 +0.55% rose $10.60 to $1,653.20 an ounce on the Comex division of the New York Mercantile Exchange. Gold closed down $7.80 to $1,642.50 an ounce on Thursday in the wake of weak China manufacturing data that weighed on commodities and global stocks markets.
That China data came on the heels of worries earlier this week that the country’s demand for metals such as iron is waning in the face of a slowdown in growth. Gold, normally a safe-haven asset, has been pressured recently along with other commodities. The metal is looking at a loss of under 1% this week.
“Gold’s currently strong correlation to riskier assets continues to weigh on bullion as we touched over two-month lows in early trading yesterday,” said Andrey Kryuchenkov, analyst at VTB Capital in a note.
He remains cautious going forward. “Overall, despite a late price rebound last night, we still don't see sustained buying from here as investors remain extremely cautious while anemic physical buyers will also need to step up purchases at these lows,” said Kryuchenkov.
Another pressure for gold, he said, is the continued strike by gold jewelers in India over the import duty hike. “We continue to trade against the dollar and more macro pressure here could still see some more small-scale losses for gold.” China, India rock gold, oil commodity markets
As for technical levels, he said a confirmed drop below $1,640 on Friday would lead to a pullback to $1,610/$1,604.5. Aside from that, he sees gold trading sideways above $1,640, with the upside capped at $1,670/$1,680.
The dollar edged lower in a reverse of Thursday’s action. The ICE dollar index DXY -0.29% , which measures the greenback’s performance against a basket of six other currencies, fell to 79.326 from 79.654 late Wednesday. Currencies
Among other metals Friday, May silver futures SIK2 +1.10% rose 46 cents, or 1.4%, to $31.80 per ounce. Copper for the same month HGK2 +1.08% rose 4 cents, or 1%, to $3.81 a pound.
April platinum PLJ2 +0.75% rose $17.50, or 1.1%, to $1,629.60 an ounce.
The June contract for sister metal palladium PAM2 +1.03% rose $11.45, or 1.8%, to $662.50 an ounce.
