Spot gold continued to march higher yesterday despite some falls in oil prices and a marginally weaker EUR/USD. The metal posted fresh year’s highs of $1761.20 after earlier lows of $1741 and closed out the day at $1759.50, up around $15 from the open in Asia. Whilst appetite for the metal remains strong, particular in Asia, the market is nearing overbought levels and after a rise of almost 15% from late December traders are becoming increasingly wary of a reversal lower. The move higher was pushed into overdrive by Fed Chairman Bernanke following last week’s FOMC meeting where he pledged low interest rates in the US until 2014 and hinted at further QE. Focus today will be on this afternoon’s US Non Farm Payroll data which will likely decide the next direction of risk. Asian markets this morning have seen the metal hover around the $1755-60 range ahead of Europe. Support is now seen towards $1741 and $1732.75 with resistance at $1767 and $1779.50
EasyForexNews Research Team