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Gold prices fell markedly today, heading for its fourth weekly drop in a row, due to the continued strengthening of the American currency.
"A strong dollar weakened the interest in gold. Demand for physical gold market can help to hold above $ 1,200, but demand is not high enough to support the market ", - said the chief dealer of Lee Cheong Gold Dealers Ronald Leung.
Many traders still do not rule out a drop in prices below $ 1,200 per ounce, which will result in further sales. Until now, falling prices are not driven by the recovery in demand for physical gold. Obviously, buyers in Asia are waiting, hoping for even lower prices. As a result, the dynamics of the price of gold is still dependent on Western investment demand. However, little support prices may have increased demand for gold in India in connection with the beginning of the holidays and the wedding season. Demand in China is also expected to increase at a holiday week from October 1.
The course of today's trading is also influenced American GDP data. It is learned that the United States economy grew at the fastest pace in the spring from the end of 2011: one more sign that the recovery is accelerating after five years of delay. Gross domestic product, the broadest measure of goods and services produced in the United States increased from a seasonally adjusted annual rate of 4.6% in the second quarter, the Commerce Department said. The Ministry had earlier said about the spring growth of 4.2%. Coincided with the revision of the forecast of economists. Economy last grew by 4.6% in the fourth quarter of 2011 and did not exceed this figure with the first three months of 2006. The last estimate (third) for the period from April to June, largely indicative of an increased level of investment in the business, in particular - for the construction of production facilities. Exports have also been revised upwards.
Experts say that after the GDP report the attention of the market gradually switched to the data on the labor market the United States, the publication of which is expected in the next Friday. This may limit the growth of quotations in the near future. Only if these data point to a slowdown in the economy, gold will be able to continue significant growth.
From a technical point of view, it is very likely that in the short term, gold will consolidate in a range 1200.00-1240.00. In this case, only way out of this range will contribute to the further development of medium-term trends.
The cost of the October gold futures on the COMEX today dropped to 1215.00 dollars per ounce.
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