Friday, October 23, 2009
The price of Gold headed towards Friday’s close more than 0.6% up on the week here in London, as world stock markets also rose alongside raw materials prices.
Recording an AM Gold Fix of $1061.25 an ounce – its best-ever Friday fix in Dollars – gold also rose vs. the Euro as the single currency held flat against the Dollar.
UK investors saw the Gold Price reverse all of this week’s losses, leaping to £648 an ounce as the Pound sank on news the UK remains in recession.
“Gold Prices will continue to be influenced heavily by Dollar movements,” reckons James Steel, metals analyst at HSBC Securities in London.
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“Should the Dollar weaken, gold is likely to remain well bid.”
Looking at this week’s tight 2% trading range, however, “Note how gold’s correlations with oil and stocks are breaking down fast with this sideways movement,” says Phil Smith for Reuters Technical India.
“The yo-yo consolidation is becoming smaller and smaller,” agrees Russell Browne at Scotia Mocatta. But “micro analysis shows triangular price behavior, suggesting a break-out is pending.
“Typically these formations are continuation in nature, so the risk is a break of $1070 that should yield a $26 move to $1096.”
Crude oil ticked higher above $81 per barrel Friday morning, but government bonds ticked lower – pushing yields higher – everywhere except the UK, which reported a surprise drop in economic output for July to end-Sept.
This article was posted: Friday, October 23, 2009 at 9:04 am