April Gold Settles At 1151.9, Up $1.30

Gold Futures failed to sustain the overnight and morning rally to settle just above the unchanged level for Thursday’s session. An overnight break in the Dollar Index pushed Gold to its best levels of the session at 1165.70 basis April futures. However, Gold was unable to regain much of its recent losses as another strong reading from the jobs sector rallied stock indices causing a retreat in the yellow metal. April Gold futures traded as low as 1147.50 before rebounding near the close to finish the session higher and snap a two day losing streak. 

In economic news today Initial jobless claims dropped to 289,000, a decrease of 36,000 from the previous week's revised level of 325,000. Economists expected jobless claims to pull back to 309,000 from the 320,000 originally reported for the previous week. However retail sales in the U.S. unexpectedly fell for a third straight month in February, a report from the Commerce Department showed Thursday, with the decrease partly reflecting a substantial drop in auto sales. Retail sales slid 0.6 percent in February following a 0.8 percent decrease in January. Economists expected sales to rise by 0.3 percent.

Outside markets specifically the rallies in the stock indices and the greenback have restrained Gold from making any consistent pushes to the upside. Both have been the investment of choice for investors leaving Gold as a third or fourth investment of choice. The increased sentiment for an impending rate hike by the Federal Reserve simply has resulted in rallies being sold in the precious metals complex. I do suspect we could see some short covering in the metals next week as the Fed starts a two day policy meeting with a policy announcement to follow the meeting.

However I believe both Gold and Silver will need either something else to enter into the market or for the Fed to surprise and adopt a more dovish tone in the near term to reverse Gold’s fortunes and ignite a rally that could have Gold to at the very least recoup its losses from last Friday’s unemployment report.