Price of Gold Fundamental Daily Forecast – Futures Jump to Highest Level in 10 Months Due to Geopolitical Concerns

Gold futures jumped to their highest level in nearly 10 months early Monday as investors reacted to North Korea’s nuclear test over the weekend. The U.S. futures market is closed on Monday due to a bank holiday so the price action is taking place in the limited electronic market.

At 0324 GMT, December Comex gold futures are trading at $1338.50, up $8.20 or +0.62%. Volume is about 53,000 contracts.

So far the rally represents the usual knee-jerk shift into safe haven assets like gold, U.S. Treasurys and the Japanese Yen. Money is moving out of the higher-yielding U.S. equity futures market and the U.S. Dollar.

Early Sunday, North Korea conducted its sixth nuclear test, which it said was of an advanced hydrogen bomb for a long-range missile, prompting the threat of a “massive” military response from the United States if it or its allies are threatened.

The United Nations Security Council is scheduled to meet on Monday to discuss the nuclear test. U.S. Defense Secretary Jim Mattis said the members of the council “remain unanimous in their commitment to denuclearization of the Korean Peninsula.”

In other news, after Friday’s disappointing U.S. Non-Farm Payrolls report, investors believe that the U.S. Federal Reserve will probably wait until the middle of 2018 before raising rates, after the government report showed employers added fewer jobs last month than expected.