Metals Stocks: Gold retreats after strong rally as Russia’s Putin orders forces to breakaway regions in Ukraine

Gold futures on Tuesday morning headed modestly lower, reversing a jump overnight to levels not seen in more than a year, as Russian President Vladimir Putin ordered troop deployments to pro-Moscow, breakaway regions of Ukraine, increasing the threat of a full-scale annexation of the Eastern European country.

Gold prices

were down $2.50, or 0.1%, to around $1,897.30 an ounce, but had touched an intrasession peak at $1,918.30, based on the continuous contract, FactSet data show. Its trading follows a 3.1% weekly rise for the precious metal on Friday, based on the most-active April contract

—marking the steepest weekly advance since May of 2021.

“Gold has had several failed attempts to break out in 2021 and while we do support owning some here, we want to see a breakout above $1,920 as the all-clear level,” wrote technical analyst Jeff deGraaf, founder of Renaissance Macro.

Putin’s order sending troops comes after Russia earlier said it was recognizing the independence of separatist factions in Donetsk and Luhansk, breakaway areas in Ukraine’s Donbas region.

The threat of a Russian invasion of Ukraine has ratcheted up tensions between Moscow and the U.S. and its allies, helping to underpin gains in precious metals, which are perceived as havens during geopolitical conflict. Gold values on Thursday hit their highest levels in about eight months, but ended lower on Friday, heading into the three-day weekend, with U.S. markets closed in observance of Presidents Day.

Read: What a Russian invasion of Ukraine would mean for markets

The moves by Putin drew a swift rebuke from the international community.

Germany took steps to halt an important natural gas pipeline, Nord Stream 2, and the White House said that President Joe Biden would issue sanctions against Moscow.

Meanwhile, officials from the European Union described Putin’s latest actions and statements as “a blatant violation of international law.”

Elsewhere on Comex, silver for March delivery

was trading flat at $24 an ounce, after putting in a weekly rise of 0.3% on Friday.

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