Gold Prices Continue Higher

Gold prices have continued to move higher over the last 24 hours and now they are in a difficult region which is likely to see a lot of selling. The region between 1295 and 1300 is going to present the gold bulls with a lot of resistance and it would not surprise us too much if the prices reverse from here. We are still sceptical of this move higher in the gold prices as it has happened during a holiday period when the liquidity is low and usually the volatility is low as well. The fact that the move has happened when most of the traders are not at their desk increases the risk that the move may be reversed at any point of time when the markets return back to normal. We expect the liquidity to come back to normal at around the second week of January.

Prices Likely to Face Resistance

Till that time, it is advisable for the traders to stay away from the gold markets and not get carried away by the move higher. There are indeed some factors that do favor this move higher. This includes the fact that the dollar has been weaker all across the board and this has been affecting the gold prices as well. There is also the fact that the bitcoin prices have moved lower and they are finding it difficult to move back higher and this could be encouraging some of the traders to leave that market and come back into gold.

The oil prices continue to flirt with the $60 region and this has been going on for the past couple of days. This region is an important one and could be the achievement of an important target for the oil producers and hence it is important for the traders to guard themselves against some sort of correction in this price region.

The silver prices have also been following the gold prices higher and it seems set to reach the $17 region in due course of time. It looks as though it is going to be only a matter of time before that target is reached,