Daily Gold Update

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold dropped 0.9% to settle just under $1,338 as easing tensions in the Ukraine spurred traders to take profits from yesterday's 2.2% surge. Vladimir Putin ordered Russian troops in the Crimea back to bases by Friday, reducing for now the likelihood of a full-scale military intervention. Risk-appetite rebounded on the apparent de-escalation, with the Dow and Global Dow each surging 1.4% while the S&P 500 jumped 1.5% to a new all-time high.

The dollar rallied and U.S. Treasury bonds fell as relieved investors eased out of safe havens. A rising dollar pressures gold and other commodities denominated in dollars for international trade by making them more expensive to holders of other currencies. Silver dropped 1.2% while platinum inched up 0.2% and palladium jumped 1.8%.

Hedge funds and other large money managers are at their most bullish on gold in fourteen months, according to Bloomberg, because of tensions with Russia, slowing global growth, and faltering currencies in emerging markets. By a margin of two to one, the most popular option traded on Comex is the right to buy April gold at $1,400 an ounce. Gold is on pace for its biggest quarterly gain since 2007.

At the Comex close: April gold fell $12.40 to $1,337.90; May silver lost 26 cents to $21.22; April platinum added $3.40, to $1,464.10; and June palladium jumped $13.80 to $763.80 an ounce.