November 21, 2019 / 4:12 PM / 3 months ago

PRECIOUS-Gold dips as hopes for U.S.-China trade deal re-emerge

    * Gold has gained over 14% so far this year
    * China invites top U.S. negotiators for more talks -WSJ

 (Updates prices)
    By K. Sathya Narayanan
    Nov 21 (Reuters) - Gold prices eased on Thursday as a report
that China has invited top U.S. negotiators for a new round of
talks rekindled some hopes regarding the U.S.-China trade deal,
but mixed signals on the progress of talks limited bullion's
    Spot gold        dipped 0.5% to $1,464.43 per ounce as of
1:49 p.m. EST (1849 GMT). Prices had notched a two-week high of
$1,478.80 in the previous session before turning negative.
    U.S. gold futures        fell 0.7% to settle at $1,463.60
per ounce.
    "Stocks are a little weak right now, but gold is still
negative and that is kind of concerning. If stocks continue to
go higher and there is some optimism about the trade deal, then
I am expecting gold to have a washout," said Daniel Pavilonis,
senior market strategist at RJO Futures.
    China will strive to reach an initial trade agreement with
the United States as both sides keep communication channels
open, the Chinese commerce ministry said on Thursday.
    The Wall Street Journal also reported that Beijing has
invited U.S. trade negotiators for a new round of face-to-face
    The next round of tariffs on Chinese goods is due on Dec.
    However, global equities and the U.S. currency markets are
still nervous about the fate of the impending "phase-one" trade
deal after Washington passed two bills intended to support
protesters in Hong Kong and send a warning to China on its human
rights policies.                                
    There have been increasingly violent protests in Hong Kong
against Chinese rule for several months and the passage of the
bills could potentially undermine efforts to secure a trade
    "Ultimately gold is going to continue to go higher but we
may get a washout before the market moves high. There is a
possibility that we get back to (the) 200-day moving average to
find some support, which is around $1,400," Pavilonis added.
    Bullion, seen as a safe haven during times of economic and
political uncertainties, has gained over 14% so far this year,
which could be its biggest yearly gain since 2010.
    "There have been some buyers on dips and the holders of gold
still hope prices will go higher. But if this does not
materialise in the near-term, they will likely take profit on
longs, pushing prices lower," said ABN Amro analyst Georgette
    Among other precious metals, palladium        slipped 0.3%
to $1,760.76 an ounce, declining after three straight days of
    Silver        was down 0.3% at $17.08 per ounce; and
platinum        fell 0.3% to $914.36.

 (Reporting by K. Sathya Narayanan, Karthika Suresh Namboothiri,
and Harshith Aranya in Bengaluru
Editing by Dan Grebler and Matthew Lewis)
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