Gold Prices Drop Lower on USD Strength

Gold prices have dropped lower and the hopes of the bulls seem to be going up in smoke. The catalyst behind the drop is the rising Treasury yields that support the US dollar. This strength began in the markets on Friday but have continued from where it left off, today as well. This has pushed gold prices below the $1340 region and now it trades below the $1330 region as of this writing. The region around $1320 is expected to provide some support in the short term and the bulls would hope that the range would come into play once again and held to prop up the gold prices.

Gold Prices Drop

This range has been going on for the past several weeks and this range has been in tandem with the range that we have been seeing in the euro as well, Now both these ranges are in danger but we believe that the prices do not have enough momentum to push through the range as yet and hence we should see the lows hold for now. We will have to keep a close watch on the price action when the US markets open later in the day and that is likely to give us a hint on whether the range would hold or not for the short term.

The impact on the oil prices seems to be minimal at this point in time as prices trade just short of the $68 region. The uptrend is well and truly entrenched, as it has been over the last few months and this trend is likely to carry the prices through to the $70 region in the short term.

Silver prices have followed the correction in the gold markets and have dropped back below the $17 region as of this writing. If the break hold, then we should see the prices back in the range between the $16 and the $17 regions.