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Metals Stocks: Gold futures finish lower after Friday’s wild ride

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Gold is trading marginally lower on Monday following a wild ride on Friday.

Price action

Gold futures
GCZ22,
-0.21%

for December delivery were down $3.80, or 0.2%, to $1,652 per ounce on Comex.

Silver futures SIZ22 expiring in December were up 29 cents, or 1.5%, to $19.16 an ounce, adding to last week’s 5.5% gain.

Palladium futures for December PAZ22 delivery were down $9.50, or 0.5%, to $1,996 per ounce, while January platinum PLF23 was up $4.20, or 0.4%, at $938.10 per ounce.

Copper futures for December HGZ22 were down 3 cents, or 0.9%, to $3.44 per pound.

What’s happening

The ICE Dollar Index
DXY,
+0.28%

is trading modestly higher on Monday while Treasury yields have mostly fallen. Each is impacting precious metals prices, along with shifting expectations about where the Fed funds target rate will be at the end of the year, analysts said.

See: Here’s why gold has been a disaster this year despite geopolitical instability and stock market volatility

“The big question which is very much influencing the price of the precious metal is if the Fed is going to slow down the pace of its interest rate hikes,” said Naeem Aslam, chief market analyst at AvaTrade.

And the fact that traders are now contemplating a 50 basis point hike by the Fed in December is giving some gold analysts hope that the bottom — at least for now — might be in.

“The trend is still lower for now but once we can actually say we have reached peak-hawkishness, the outlook for gold will very likely shift to neutral (if not bullish) from bearish,” said Tom Essaye, a former Merrill Lynch trader and the founder of the Sevens Report newsletter.

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