Forexpros – bsp; Forexpros – Gold futures continued falling early Friday morning despite worries that the European summit will not result in viable debt crisis solutions and news of bullishness in the gold market.
On the Comex division of the New York Mercantile Exchange gold futures for February delivery traded at USD1709.05 a troy ounce, dropping another 0.23%.
It earlier fell to a low of USD1707.45 a troy ounce and hit a high of USD1719.75 during the session.
Gold futures were likely to find support at USD1705.25 a troy ounce and technical resistance exists at USD1717.85.
For much of the last year, investor’s typical reaction to bad news from Europe was to buy gold boosting the safe haven appeal of the yellow metal, but this correlation has unraveled recently.
Instead gold futures have moved largely in line with other commodities and risk sensitive assets over the past month, with investors preferring the relative safety of the U.S. dollar.
Meanwhile, a Bloomberg survey revealed that 18 of the 26 gold traders interviewed expect the yellow metal to climb next week.
Mark O’Bryne, executive director of GoldCore Ltd told Bloomberg, “People are buying out of fear. Central banks are pursuing extremely loose monetary policies and we still have negative real interest rates. That makes gold attractive”
However, price has been recently been telling another story.
The euro traded sharply lower against the U.S. dollar, while the dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was higher by 0.30% to trade at 79.12.
Elsewhere on the Comex, silver for March delivery firmed up 0.24% to trade at USD31.62 a troy ounce, while copper for March delivery gave back 0.52% to trade at USD3.48 a pound.
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