The price of gold is down 2% from its peak today due to profit booking, while silver is down 3%.

20/7/2024,

By 1422 GMT, spot gold had dropped 1.8% to $2,401.49 an ounce. Before this, gold reached an all-time high on Wednesday of $2,483.60.

Bullion hit a new high earlier in the week as expectations of a U.S. interest rate cut in September grew. But on Friday, as investors cashed in and the dollar strengthened, gold prices dropped by more than 2%.

By 1422 GMT, spot gold had dropped 1.8% to $2,401.49 an ounce.

 

 For gold, pullbacks following new highs have been a regular trend in recent months; comparable declines occurred in May, April, March, and December. The peak was followed by a decline that levelled out in roughly two weeks, stabilising the market and sending it back up.

 

But bull markets don't last forever, so traders need to be alert for signs that the bullish trend is shifting. According to Alex Kuptsikevich, senior market analyst at FxPro, "We monitor the following warning signs."

 

What factors affect gold's price?

The benchmark 10-year Treasury yield rose, while the US currency appreciated 0.1% vs other currencies, placing pressure on bullion.

 

According to the CME FedWatch Tool, markets currently project a 98% chance that the US Federal Reserve will lower interest rates in September. In general, non-yielding bullion is more appealing when interest rates are low.

 

This week, Jerome Powell, the chair of the Federal Reserve, said that recent inflation data "add somewhat to confidence" that the rate of price increases is steadily approaching the central bank's target.

 

Asia's physical gold demand was not strong this week. Despite large reductions, buyers were hesitant to make more purchases and preferred to take advantage of record-high bullion prices.

 

Palladium declined 1.2% to $918.93, platinum down 0.2% to $965.90, and spot silver sank roughly 3% to $29.17 per ounce. Every one of the three metals was expected to drop each week.