https://arab.news/c7x74
- “Gold’s upward momentum is very strong and it is likely to challenge a key psychological level at $1,900 in the days to come”
LONDON: Gold firmed on Monday, edging back toward last week’s 4-1/2-month peak as the dollar held near its weakest since late February, with investor focus turning to key economic readings from the US this week.
Spot gold was up 0.2 percent at $1,883.25 per ounce, having last week reached its highest since Jan. 8 at $1,889.75. US gold futures gained 0.4 percent to $1,884.30.
Following last week’s volatility, gold has moved above its 200-day moving average, supported by a weaker dollar and bond yields and questions about inflation, said independent analyst Robin Bhar. Gold is considered a hedge against inflation. The dollar was pinned near three-month lows, while US Treasury yields stayed subdued.
Meanwhile Bitcoin rebounded slightly, but was still under pressure following a recent crash.
“The recent slide in cryptocurrencies also boosted the appeal of gold as an alternative investment asset,” said Margaret Yang, a strategist at DailyFX.
“Gold’s upward momentum is very strong and it is likely to challenge a key psychological level at $1,900 in the days to come.”
Markets will be keen to hear if Fed speakers this week will stick to being patient with policy, while awaiting data including the US gross domestic product, jobless claims and durable goods on Thursday.
Rising US inflationary risks have spooked markets, and minutes from the Fed’s last meeting suggested some policymakers were ready to talk about reducing stimulus.
“The overall tone remains positive as the markets look at prospects for inflation, geopolitical risk and continued economic uncertainty in the face of the Indian variant of the COVID virus and the slow rate of vaccination across much of Asia,” StoneX analyst Rhona O’Connell said in a note. But gold could be bound for a correction, with prices now in “overbought” territory, O’Connell added.
Elsewhere, palladium was little changed at $2,782.43 per ounce, silver gained 0.8 percent to $27.74, and platinum rose 0.5 percent to $1,172.45.