Gold intermarket: Gains limited in the short-term

Gold edged higher in a quiet session overall, despite ongoing geopolitical turmoil in Turkey following Friday’s coup attempt.

The yellow metal advanced on Friday and closed at 2-day highs supported by the risk-off mood, but failed to extend the rally beyond the $1,340/oz area.

While gold gains on the back of Turkish events proved short-lived as knee-jerk reaction fades, 10-year US treasury yields rose to 1.589% while the dollar index hovers near Friday’s highs,  evidencing seek for safety still present in financial markets.

Looking at the VIX, a measure of volatility in the US stocks market, the index spiked earlier on the session but then pulled back, giving no clear signs.

Overall, the yellow metal could continue to benefit from the cautious mood, although momentum is lacking at time being, confining gold to a quieter phase as dust settles.