Monday, 23 Nov 2009

Gold Soars as the Dollar Weakens

The dollar weakened against most of its major currency counterparts during the morning trading session. The Dollar is currently trading lower against the GBP by nearly 100 pips at 1.6620. It is also trading lower against the EUR and CHF, as investors remain wary of making big bets in favor of the Dollar these days.

Gold rose towards $1,064 on Monday as the dollar fell against the EUR and crude oil maintained its strength, although some resistance emerged around that level. Further gains could be on hold for the rest of the day, however, as investors await news that will provide clues to the state of the global economy.

The release of the U.S Existing Home Sales at 13:00 GMT is likely to set the tone for the Dollar's direction in today's trading. Better-than-expected results may help the Dollar recover some of early trading losses against some of its crosses such as the GBP. On the other hand, if the results turn out to be in line with forecasts, then the Dollar may record a fairly bearish session in today's trading.