Tuesday, 8 Jun 2010

Spot Gold Reaches New Record High

The price of spot gold rose to a new record high today as the bullish streak in the commodity continues. However, the commodity was unable to hold the gains through the New York trading session and has since fallen below its opening price.

Spot gold prices climbed to a high of $1251.76 before retreating to its opening day price at $1237.50. The commodity is often used as a safe-haven asset in times of uncertainty. Market participants at this time have fears surrounding the fiscal crisis in the European Union member nations of Greece, Portugal, and Spain, have since spread to the non EU nation Hungary.

The euro climbed to a high of 1.2008 versus the dollar during the European trading session, only to fall back towards the 1.1950 level towards the end of the New York session. The move occurred in sync with a rise in U.S. equities. The Dow Jones Industrial Average is trading higher today by 1.25%.

A lack of economic data has kept most currencies in a tight range the past two days. However, tomorrow will bring the release of British trade balance numbers, a speech by Federal Reserve Chairman Ben Bernanke, and the weekly crude oil inventories report. Traders should eye these data pieces in preparation of a breakout from the limited price movement in the major currency pairs.