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Gold starts week on upbeat note in Asian trading

Published 07/28/2013, 08:29 PM
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Investing.com - Following a modest weekly advance last week, gold futures traded higher in the early part of Monday’s Asian session as a potentially volatile week for the yellow metal looms.

On the Comex division of the New York Mercantile Exchange, gold futures for September delivery rose 0.56% to USD1,329.35 per troy ounce in Asian trading Monday after advancing 0.69% last week.

Gold futures were likely to find support at USD1,295.45 a troy ounce, the low from July 21 and resistance at USD1,375.85, the high from June 19.

Gold faltered a bit last Friday amid some decent U.S. economic news. In U.S. economic news out last Friday, the Thomson Reuters/University of Michigan final index of consumer sentiment for July rose to 85.1 from 84.1 last month. Economists expected a July reading of 84. The initial July reading was 83.9.

Comex gold prices rose to an almost five-week high of USD1,347.85 a troy ounce on Tuesday, a day after a weaker-than-expected report on U.S. home sales fueled market talk that the Federal Reserve will keep stimulus measures in place for now.

The Fed releases its monthly monetary policy statement this week, an event that has the potential to be the deciding factor in gold’s near-term fortunes. Earlier this month, Fed Chairman Ben Bernanke assuaged gold bugs by saying the central bank will keep its accommodating monetary policy in place for the foreseeable future.

However, still fresh on the minds of some gold traders are comments Bernanke made in May that sent the yellow metal tumbling.

Gold will also be in focus ahead of the release of the U.S. non-farm payroll report for July on Friday. Last Thursday, the U.S. Labor Department said initial claims for jobless benefits rose by 7,000 to 343,000 last week. Economists expected a reading of 340,000 new claims. The unemployment rate among people eligible for benefits dropped to 2.3 percent in the week ended July 13 from 2.4 percent the prior week, according to Bloomberg.

Elsewhere, Comex silver for September delivery advanced 0.52% to USD19.873 per ounce while copper for September delivery fell 0.36% to USD3.093 per ounce.


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