Investing.com - Gold futures were mildly higher during U.S. morning trade on Thursday, tracking gains in the euro after market sentiment improved as Greek Socialist leader Evangelos Venizelos was to make a last attempt to form a government.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at USD1,600.35 a troy ounce during U.S. morning trade, gaining 0.4%.
It earlier rose by as much as 0.45% to trade at a session high of USD1,601.75 a troy ounce. On Wednesday, prices fell to as low as USD1,579.95, the lowest since January 3.
Gold futures were likely to find short-term support at USD1,572.65 a troy ounce, the low from January 3 and resistance at USD1,642.95, the high from May 7.
Gold prices took cues from the currency market on Wednesday, tracking movements in the euro. Gold remains more sensitive to moves in the euro/dollar exchange rate in the short term than to rising risk aversion, which in the past has been a positive driver of prices.
The euro rebounded from a three-and-a-half-month low against the U.S. dollar as market sentiment improved slightly as Greek Socialist leader Evangelos Venizelos was to make a last attempt to form a government on Thursday.
Venizelos, who was the country’s former finance minister, said he would approach all political party leaders and try to get New Democracy, Syriza and Democratic Left to form a pro-European national unity government.
Meanwhile, gold traders assessed the release of mixed U.S. data, which failed to reassure investors over the level of the country’s economic recovery.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits last week fell by 1,000 to 367,000, defying expectations for an increase of 1,000 to 369,000.
But the previous week’s figure was revised up to 368,000 from 365,000.
A separate report showed that the U.S. trade deficit widened more-than-expected in March, as exports increased 2.9% and imports grew 5.2%.
The U.S. trade deficit widened to USD51.8 billion in March from a revised deficit of USD45.4 billion in February, above expectations for a deficit of USD50.0 billion.
Also Thursday, data showed that import prices in the U.S. fell more-than-expected in April, declining 0.5% after a 1.5% the previous month. Analysts had expected import prices to fall 0.1% in April.
Gold investors will be closely watching U.S. data in the second quarter for clues as to the likelihood of a fresh round of monetary easing, which could potentially hurt the dollar and support gold.
Meanwhile, Wall Street investment bank Goldman Sachs reiterated its bullish stance on the precious metal, despite a recent run of losses.
The bank stood by its forecast for a rally in gold this year, saying that the precious metal will advance to USD1,840 an ounce over six months as the Fed embarks on a third round of stimulus in June.
Gold prices have lost nearly 4% in the three sessions leading up to Thursday, as growing fears over an escalation of the debt crisis in the euro zone drove investors to the relative safety of the U.S. dollar.
Although gold’s appeal as a safe haven is boosted during times of economic uncertainty, the euro zone’s debt crisis has done little to bolster appetite for the precious metal.
A weakening euro and stronger dollar have weighed on gold instead.
Gold’s losses so far this week have also been exacerbated after prices broke below key support levels, triggering fresh sell orders amid bearish chart signals.
Technical traders expect the next level of support for gold to be at USD1,567 after it broke below USD1,620 on Tuesday, the lower end of the price range it had held since early April.
Some market participants noted that heavy losses in stocks and other commodities markets accelerated gold’s sell-off, as traders were forced to sell their gold holdings to raise cash to cover losses elsewhere.
In October 2008, gold prices tumbled 18% as turmoil in global financial markets led to losses in global equity and commodity markets. The precious metal rallied 23% in the next two months.
Elsewhere on the Comex, silver for July delivery rose 0.35% to trade at USD29.34 a troy ounce, while copper for July delivery jumped 1.05% to trade at USD3.698 a pound.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at USD1,600.35 a troy ounce during U.S. morning trade, gaining 0.4%.
It earlier rose by as much as 0.45% to trade at a session high of USD1,601.75 a troy ounce. On Wednesday, prices fell to as low as USD1,579.95, the lowest since January 3.
Gold futures were likely to find short-term support at USD1,572.65 a troy ounce, the low from January 3 and resistance at USD1,642.95, the high from May 7.
Gold prices took cues from the currency market on Wednesday, tracking movements in the euro. Gold remains more sensitive to moves in the euro/dollar exchange rate in the short term than to rising risk aversion, which in the past has been a positive driver of prices.
The euro rebounded from a three-and-a-half-month low against the U.S. dollar as market sentiment improved slightly as Greek Socialist leader Evangelos Venizelos was to make a last attempt to form a government on Thursday.
Venizelos, who was the country’s former finance minister, said he would approach all political party leaders and try to get New Democracy, Syriza and Democratic Left to form a pro-European national unity government.
Meanwhile, gold traders assessed the release of mixed U.S. data, which failed to reassure investors over the level of the country’s economic recovery.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits last week fell by 1,000 to 367,000, defying expectations for an increase of 1,000 to 369,000.
But the previous week’s figure was revised up to 368,000 from 365,000.
A separate report showed that the U.S. trade deficit widened more-than-expected in March, as exports increased 2.9% and imports grew 5.2%.
The U.S. trade deficit widened to USD51.8 billion in March from a revised deficit of USD45.4 billion in February, above expectations for a deficit of USD50.0 billion.
Also Thursday, data showed that import prices in the U.S. fell more-than-expected in April, declining 0.5% after a 1.5% the previous month. Analysts had expected import prices to fall 0.1% in April.
Gold investors will be closely watching U.S. data in the second quarter for clues as to the likelihood of a fresh round of monetary easing, which could potentially hurt the dollar and support gold.
Meanwhile, Wall Street investment bank Goldman Sachs reiterated its bullish stance on the precious metal, despite a recent run of losses.
The bank stood by its forecast for a rally in gold this year, saying that the precious metal will advance to USD1,840 an ounce over six months as the Fed embarks on a third round of stimulus in June.
Gold prices have lost nearly 4% in the three sessions leading up to Thursday, as growing fears over an escalation of the debt crisis in the euro zone drove investors to the relative safety of the U.S. dollar.
Although gold’s appeal as a safe haven is boosted during times of economic uncertainty, the euro zone’s debt crisis has done little to bolster appetite for the precious metal.
A weakening euro and stronger dollar have weighed on gold instead.
Gold’s losses so far this week have also been exacerbated after prices broke below key support levels, triggering fresh sell orders amid bearish chart signals.
Technical traders expect the next level of support for gold to be at USD1,567 after it broke below USD1,620 on Tuesday, the lower end of the price range it had held since early April.
Some market participants noted that heavy losses in stocks and other commodities markets accelerated gold’s sell-off, as traders were forced to sell their gold holdings to raise cash to cover losses elsewhere.
In October 2008, gold prices tumbled 18% as turmoil in global financial markets led to losses in global equity and commodity markets. The precious metal rallied 23% in the next two months.
Elsewhere on the Comex, silver for July delivery rose 0.35% to trade at USD29.34 a troy ounce, while copper for July delivery jumped 1.05% to trade at USD3.698 a pound.