AGE Daily Gold Update presents a recap on today's action in the precious metals markets. View archives.
8/11/2020: Gold tumbles on vaccine hope
Source: Bill Musgrave, American Gold Exchange
Austin — Gold tumbled 4.6% to close under $1,947 after Russia announced the development of a coronavirus vaccine, prompting a technical selloff as traders took profits from the metal's epic rise to new all-time highs.
Vladimir Putin said today that Russia has registered the first vaccine for treatment of COVID-19. Although the drug has yet to complete the necessary trials to ascertain its safety or genuine effectiveness, the announcement nonetheless spurred a spike in risk appetite among investors hungry for any news that the devasting pandemic may soon be contained.
An open letter to Russia's heath ministry from Russia's Association of Clinic Trials Organization, a nongovernmental agency, tried to delay the registration, warning that the drug has "not even completed testing on 100 people." The WHO said it has not received enough information for evaluation.
Wall Street initially rose following the news before sliding back into losses as skepticism mounted. Treasury prices fell and yields jumped on the shift away from safe havens.
Gold's relentless rise in recent weeks to a series of new all-time highs led many traders to anticipate a healthy correction before the next leg higher. The vaccine announcement occasioned this correction. Once the price began to fall it triggered stop-loss orders that quickly built upon themselves, propelling gold to its biggest one-day drop since 2013.
The other precious metals were also sharply lower, with silver plunging 11% while platinum and palladium lost 3.1% and 4.2%, respectively.
At the Comex close: December gold lost $93.40 to $1,946.30; September silver plunged $3.21 to $26.05; October platinum dropped $31.30 to $971.40 an ounce and September palladium shed $95.40 4 to $2,175 an ounce.
AGE Gold Commentary
Gold is gathering momentum to begin its assault on the previous record high of $1,911 and then push above $2,000 ... read more