The price of gold fell during today’s trading. The tendency of traders to take risks has increased, and investors took profits after the gold’s price increase.
Gold prices rose strongly since the end of last month after British citizens decided to leave the EU. The market volatility that followed this decision, soon stopped, and investors in the gold market took profits in anticipation of other important economic data, said Ira Epstein of the Linn Group.
The positive employment report in the US, which was released on Friday, has also helped to reduce concerns about the US economy. On Tuesday, US stocks continued to rise after reaching highs Monday.
“Investors are suddenly switched their attention to the stock market and started to sell some other assets, including gold,” – said Epstein.
Strong data from the US labor market forced some investors to believe that the US Federal Reserve this year could raise interest rates. Higher interest rates usually put pressure on gold, which become less attractive compared to other assets that generate income.
Many analysts remain optimistic about forecasts for gold on the background of negative interest rates around the world. However, the price of gold may be reduced because of the greater risk appetite.
“We should not be surprised to profit taking on gold as investors in other markets will be more inclined to take risks,” – said William Adams of Fastmarkets.
The cost of the August gold futures on the COMEX fell to $ 1341.4 per ounce.
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