Ramp Metals stock surges on Sprott backing for Saskatchewan project
Ramp compares its project with the eye structure of the Nova-Bollinger nickel-copper mine in Western Australia.
The gold price fell more than $25 on Tuesday, hurt by a combination of a showing of strength for the US economy, hopes of an easing of the conflict in Ukraine and technical factors.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery – the most actively traded contract following the expire of June options – traded at $1,265.90 an ounce in midday dealings, near the lows of the day and down over 2% from yesterday’s close.
Gold has wiped out a chunk of its gains for the year trading a levels last seen February 7 and down $115 an ounce from 2014 highs reached mid-March.
Data out on Tuesday showed US consumer confidence rose, durable goods orders increased and one housing measure in the world’s largest economy showed double digit gains.
The economic news which was broadly in line with expectations boosted the dollar and pushed the gold price in the opposite direction. Investors also took the opportunity to rotate out of gold and into stock markets, sending New York indices into fresh record territory.
Gold status as a hard asset and safe-haven during times of turmoil was tarnished by a cooling of tensions in the Ukraine after mostly peaceful elections and the ousting of separatists in the east of the country.
After trading in a tight range for more than two months on either side of $1,300 an ounce, gold broke through key technical levels on Tuesday.
According to some technical analysts gold was primed for a break-out price move and the drop to below $1,280 could signal further selling:
“The path of least resistance was lower, as gold broke through its recent range. The wedge of $1,287 -$1,305 gave way overnight as sellers reemerged after the election in the Ukraine. Although, tensions remain high in that country, the risk premium has eased and traders pushed through recent support, as we find ourselves at a pivotal level of $1,277.
A stronger U.S. dollar tone, aided by better than expected April durable goods, up 0.8%, continue to drive capital into to the equity markets. The $1,277 level must hold to prevent a test of significant support at $1,262. said Peter Hug, global trading director at Kitco Metals, in his note.
Sentiment on the gold market was also hurt by the latest data from the World Gold Council released last week that showed demand from top gold consumers China and India slowed dramatically in the first quarter of this year.
At the same time investors also continued to pull money out of the SPDR Gold Trust (NYSEARCA:GLD), the world’s largest physically-backed gold ETF accounting for over 40% of total holdings in the industry.
Holdings in GLD continued to slide in May after 24 tonnes worth of net redemptions in April. Holdings now stand at 776.9 tonnes or less than 25 million ounces, the lowest level since December 2008.
