USD1,215 continues to represent nearby resistance for gold

Improved corporate performance and forecasts from the likes of Alcoa and BMW - forecasting a 10% increase in sales - have boosted the global equity markets and have seen the dollar weaken during the morning, offsetting a much weaker than expected ZEW Survey of German Economic Sentiment. The weaker dollar has helped gold and the PGM’s to rally, while the PGM’s also appear to have received an additional boost from the BMW figures.

In addition, a reduction in Portugal’s credit rating to A1 from Moody’s served as a reminder to the market about Southern Europe’s debt issues and also appeared to lend support to gold prices, albeit with little lasting impact on the Euro. As noted in recent reports, $1,200/oz again appears to be the approximate floor for gold prices, though volumes overnight were pretty light. $1,215 continues to represent nearby resistance for gold.

Improved expectations of car sales from European manufacturers - boosted by a weaker Euro - has boosted sentiment towards the PGM’s, with vehicle sales post the various scrappage schemes continuing to be a key signal in terms of PGM demand and an important source of support for prices.

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