Gold aims for highest level in over 3 weeks

Published: Jan 4, 2017 9:54 a.m. ET

Palladium on track for biggest daily gain in 2 months

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Gold has risen in 5 of the last 6 sessions.

Gold futures on Wednesday were trading tepidly higher as the U.S. dollar retreated from its 14-year high, providing a path for the yellow metal to climb.

Moves for metals come ahead of a 2 p.m. Eastern release of minutes from the Federal Reserve’s December policy-setting meeting, which could offer further clues about the path of monetary policy and influence metals.

Gold for February delivery GCG7, +0.43% gained $3.60, or 0.3%, at $1,165.80 an ounce, after rising 0.9% on Tuesday. Gold futures have advanced in five out of the last six sessions and appear to be staging a mini rally in the wake of a downtrend in December sparked by expectations that President-elect Donald Trump will work to enact policies that may be bullish for stocks but less favorable to assets that are considered havens, like gold.

In November, following Trump’s election victory over Hillary Clinton, gold suffered its worst monthly drop, down 7.8%, since a more than 12% decline in June 2013. On the bright side, the metal registered a 8.6% return in 2016.

However, some market researchers believe bearish bets that the metal will fall further amid expectations of further strength in equities are overdone, which may set the stage for a rebound in the precious metal.

“It does look like gold prices are no longer headed lower so we do expect a more vigorous response in the gold price as the market is overhung with huge short positions in the futures and options markets,” wrote Julian Phillips, founder of in a Wednesday research note.

“The rise in gold prices can be attributed to short covering before the [Federal Open Market Committee’s] minutes and upcoming various U.S. jobs numbers tomorrow and Friday,” said Chintan Karnani, chief market analyst at Insignia Consultants.

Karnani said a weaker dollar against the major currencies like the yen USDJPY, -0.35% also help give gold a boost. Dollar-priced metals tend to be more attractive to buyers using other monetary units when the U.S. dollar weakens. A gauge of the dollar’s strength, the ICE U.S. Dollar Index DXY, -0.64% was off 0.3% at 102.89 coming off touching a 14-year high on Tuesday. The dollar index compares the strength of the greenback against a basket of six currencies.

In exchange-traded products, the SPDR Gold Trust GLD, +0.55%  gained 0.4%, the VanEck Vectors Gold Miners ETF GDX, +0.46% climbed 0.6% and the iShares Silver Trust SLV, +1.23% was up 0.6%.

Meanwhile, March silver SIH7, +0.92%  tacked on 2 cents, or 0.2%, at $16.43 an ounce.

Elsewhere on metals traded on Comex, April platinum PLJ7, +0.65% gained $5.40, or 0.6%, at $949.80 an ounce, March palladium PAH7, +4.11% jumped $26.60, or 3.8%, to $736.50 an ounce, putting the metal on track for its largest daily climb since early November. March copper HGH7, +2.79%  picked up 6 cents, or 2.6%, to $2.553 a pound.