With only one trading day left for the calendar year 2019, gold is benefiting from US dollar weakness and thin holiday volume. Today’s volume in the February contract of gold futures is only 204,993. As of 4:00 PM EST spot gold is currently trading up $3.70 and fixed at $1514.50.

Despite some selling pressure dollar weakness has kept pricing afloat, with gold futures trading fractionally higher on the day. On the surface today’s gains in February gold futures seem minuscule or insignificant at best, however nothing could be further from the truth. If not for a deep daily decline in the U.S. dollar index gold would be trading underwater today.

It is an odd occurrence when U.S. equities and the precious metals complex run in tandem and gain value at the same time. Typically, investors favor either the risk-on asset class, or the safe-haven asset class, moving capital between the two depending on the market environment. That is exactly what we are witnessing in the financial markets.

Although today was a short day in trading with the markets closing at 2 o’clock EST, that did not stop traders from taking gold higher. Over the last two days we have seen gold gain of us $25, after factoring in today’s gain of over $15 per ounce.

Although gold does not have seasonal tendencies like many commodities such as grains, there are holidays that boost demand like Diwali in India, and Chinese New Year’s. There has also been a recent trend of gold railing between December and January over the last few years.

On Wednesday evening President Trump became the third U.S. president in history to be impeached. This process was run by the House of representative which contains a majority of Democrats. They approved abuse of power and obstruction of Congress as their two primary charges waged against President Trump. 

There is no doubt about it, volume is thinning out as the holiday season closely approaches. Today for example volume in gold futures is sitting at 173,253 contracts. That is just a small percentage of the large volume witnessed in November which would average about 300,000, and on November 7^th actually spiked to 678,673.

The precious metals complex is trading fractionally lower today as U.S. equities continue to rise. Given that US equities are only fractionally higher gold, silver and platinum are all trading fractionally lower. This all-in light of dollar strength providing some headwinds to any potential gain.

As of 4:00 PM EST gold futures basis the most active February contract lost $0.30, and is currently fixed at 1480.90. This fractional decline of -0.03% is lower in light of dollar weakness, with the dollar index currently down by -0.15% and fixed at 96.60.