A Quick Look at Gold Prices
May 29th, 2009 Posted in Oil and Precious Metals
Gold for immediate delivery was at $955.70 early Monday. It advanced to $961.33 May 22, the highest since March 20. Gold for June delivery in New York was down 0.3 percent at $956.10 Friday. The recent increase in Gold prices is mainly driven by a weak Dollar and a retreating stock market.
Gold is expected to continue its upward trend as a weakening dollar prompted interest in the precious metal as a replacement haven investment to the U.S Dollar. Gold typically presents an opposite trend to the Dollar.
There are rising concerns the global recovery is going to be bumpy. The main risks come from fears of a rising inflation and the flooding of the financial system with Dollars; both brought up by the recent news regarding Federal Reserve’s intention to purchase more Dollar denominated assets in order to secure a stronger economic recovery. This statement has also affected the stock markets as it suggests a deeper recession that previously perceived, causing the markets to retreat and increasing Gold’s upward momentum as well.
While the current trend of appreciation for the Gold is likely to continue in the short term, there is a sentiment that the recent bullish trend is somewhat exaggerated and once the equity markets start showing little more gain the bullish trend will dampen.
Start trading with Greg Holden now:
Tags: Au, Au trading, Commodities Trading, Gold, gold and forex, Gold forecast, gold prices, Gold trading, trading gold
