Forexpros – Gold futures fall as U.S. employment reports confirm the economic recovery triggering a flight to riskier assets
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1740.95 a troy ounce during early U.S. trade falling 1.02%.
It earlier hit a high of USD1765.85 a troy ounce, and hit a low of 1735.75 near the support level.
Gold futures were likely to find support at USD1735.45 a troy ounce, Wednesday’s low and technical resistance exists at USD1765.85 a troy ounce, today’s high.
Gold’s selling was triggered as non farm payrolls in the U.S. beat the forecast by adding 243,000 according to official data, and the unemployment rate dropped to 8.3%.
This improvement cause’s doubt that the Federal Reserve will be able to stick to its vow not to raise interest rates until late 2014 and triggered a flight into equities, away from so called safe haven investments.
The surprising rise in employment was broad based, involving multiple economic sectors.
In addition earlier, Federal Reserve Chairman, Ben Bernanke stated at his testimony that the economy is showing signs of improvement. In addition to requesting lawmakers to reduce the long term U.S. budget deficit.
Meanwhile, Bank of America has forecasted gold prices to hit USD2000 a troy ounce by the end of 2012, based on fundamental price factors.
Elsewhere on the Comex, silver for March settlement gave back 1.75% to trade at USD33.58 a troy ounce, while March copper futures gained 2.12% to trade at USD3.86 a pound.
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