Gold prices popped higher on Malaysian Airliner news
It was an interesting day in the gold market today-and in world markets for that matter. Gold prices were slightly higher on the session when news hit the wires that a Malaysian Airliner had been shot down over Ukraine near the Russian border. Gold prices popped higher on the news, and traded as high as $1325 and change before coming off of the highs. Crude oil and other commodities such as wheat also saw bids lifting offers as the news broke. Stocks also got hit, and risk aversion seems to be taking hold right now as uncertainty surrounding the crash feeds fears and speculation.
While both sides in the Ukrainian conflict have denied involvement, it is reported that some U.S. intelligence agencies have confirmed that a surface-to-air missile downed the jetliner. The tensions surrounding Ukraine and Russia are clearly escalating. The U.S. on Wednesday announced new sanctions against Russia that are the toughest yet. Russian President Vladimir Putin has said that Russia may retaliate. The situation clearly does not appear to have a resolution in sight, and that may keep gold and other perceived safe-haven assets well bid. Gold had been moving lower and recently fell back below the psychologically important $1300 level, but had bounced back yesterday as well as today as the bulls sought to reclaim this level. Some are also now calling a top in stocks, which may also potentially fuel buying in gold as risk aversion and asset reallocation take hold. Gold prices may very well try to challenge last week's highs in the $1346 area over the new few sessions. Of course, a lot of market action not only in gold but other markets as well will likely be headline driven over the coming days as new information emerges. For now, however, it seems that risk appetite is likely to continue to decline.
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18 Jul 2014 | Categories: Gold
