Gold

Gold slipped on Monday as the U.S. dollar strengthened. Spot gold lost 0.3 percent at $1,319.27 per ounce.

Bullion rebounded last week as the dollar sagged after U.S. April inflation data fell short of expectations. But the dollar’s correction could be temporary as the CPI data was still resilient. No turning point will show up in the near term.

Further bullion support could come from rising security risks in the Middle East after the United States said it would withdraw from the 2015 international nuclear deal with Iran and reimpose sanctions. But market was muted, failing to offer strong support to gold.

Holdings of gold at world’s largest exchange traded funds declined last week, weighing on gold prices. Retail report due tonight will impose an impact on the dollar index as well as gold. We hold a bearish view on bullion, and suggest short on highs.

Silver

Silver was down 0.7 percent at $16.51 per ounce, moving in tandem with gold. The resistance at $16.8 was strong. Market bears are suggested to build short positions at this level before squaring at $16.2-16.3.

 
Dealing Room, ICBC Beijing Branch
                       Qin Gang