Gold Supported by Crude Oil at Yearly High and USD Near Record Lows

By: GoldCore

Gold is currently trading at $1,055.60/oz. With oil reaching a new high for the year above $79 a barrel, and the Federal Reserve signaling interest rates will stay near record lows for the foreseeable future, the beleaguered greenback fell to a 14-month low on the dollar index. The poor jobs number on Friday left lingering doubts regarding the sustainability of the recovery and this also supported gold.

Gold had another higher weekly close last week which is important from a technical perspective. This could lead to technical traders and momentum funds increasing their long positions and possibly creating a short squeeze. If there is period of profit taking, there is likely to be support at previous resistance between $1,020/oz and $1,030/oz and strong support at $1,000/oz.

A very sharp correction could see gold fall some 10% from the recent high ($1,070/oz) to $960/oz. If this happened it would be a great buying opportunity and could be the last time to buy gold under $1,000/oz for the foreseeable future. In Euro and GBP terms gold is trading at €706.63/oz and £648/oz. Support for gold is currently seen at $1,034/oz and resistance at $1,054/oz.

Silver
Silver is trading at $17.48/oz. In euro and GBP terms silver is trading at €11.70/oz and £10.73/oz.

Platinum Group Metals
Platinum is trading at $1,351/oz while rhodium and palladium are trading at $1,650/oz and $331/oz respectively.

The Bullion Services Team

WINNERS MoneyMate and Investor Magazine Financial Analysts 2006

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