Gold Breaks Through $1320 region

Gold prices continued to move higher during the course of trading yesterday as the prices broke through the 1220 region and went as far high as 1226 before correcting back lower. The move higher was brought in mainly due to the weakness in the dollar which went on to the backfoot once again, after gaining some respite on the day before. The dollar was weak all across the board and the gold bulls did not need a second invitation to push the prices even higher than where it had been earlier. But we have some major data coming in from the US later in the day which is likely to determine the short term direction for the gold prices.

Gold Continues Higher

As we have been mentioning over the last few days, we are a bit surprised on the continued upmove in the gold prices despite the fundamentals pointing to the opposite. Though it has to be agreed that the dollar has been weakening across the board, we do not believe that the weakness in the dollar has been as much as the rise in gold prices has made out to be and hence we are waiting to see any kind of a reversal. Also, as we have pointed out many times over, we are also seeing that the price move higher has happened on low volume and hence that also makes this move a bit suspect. The final say in this matter is likely to arrive today, with the NFP data coming out from the US later in the day.

The oil prices continued to trade near the $62 region and it seems as though it is set to test the $65 region in the short term. The oil prices continue along merrily in its uptrend and there does not seem to be anything that has adversely impacted the oil prices as yet.

Silver prices also moved towards the $17.3 region but as we have been saying over the last few forecasts, the impact of the dollar weakness on the silver prices has been much less than what we are seeing in the gold market.