Gold below $1,250/oz on profit booking
Gold prices on Monday slipped below psychological mark-$1,250 an ounce on profit booking. Investors preferred to cash in on recent surge in the yellow metal. Gold price fell for four weeks in the past five weeks.
Gold futures April contracts fell $9 to $1,245.30 an ounce. Taking cues from weekend losses, gold prices fell on opening session of the week also. Gold contract fell $10.70 to $1.254.30 per ounce on Friday. In overall, gold price eased 0.4 percent for previous week indicating fourth losing week in five weeks.
Market Watch reports that yellow metal pulled back as US dollar against Japanese Yen eased lower 0.09 percent. The key support level of gold is $1,250 an ounce. Tracking gold price drop, silver also eased seven cents to $15.74 an ounce.
US Federal Reserve gave a reduced outlook for interest rate hike and this lifted precious metals last week. US Federal Reserve lowered outlook on interest rate hike from forecast of four in December 2015 to two this year. Fed has also cut the worth of holding non-yield gold prices in dollars.
Central banks rhetoric turn more dovish, investors are looking for more cues to get a clear picture. Recent few data releases indicate whether long-lasting loose monetary policies are having any real impact.
Emirates 24/7 further adds that despite drop in spot gold, it's finding support from weaker dollar. Central banks in the US and Europe are still keeping prospects of cheaper capital alive. Spot gold was marginally down by 064 percent to $1,245.82 an ounce. Prices are in consolidation below 14-month peak of $1,282.51 recorded on 11 March. It's also highest since January 2015. Gold price tumbled below $1,050 in December 2015.
Lukman Otunuga, research analyst at FXTM, in a note, said: "The ongoing fears over slowing global growth and the anxious approach fostered by central banks have continued to boost appetite for safe haven investments such as gold, which found support around $1,225."
Market analysts see support level below $1,250 per ounce based on mixed market influence and consolidation last weekend. Gold prices rose above $1,265 in early Asian trading on last Friday. It seemed reestablishing of bullish momentum, but it couldn't sustain at that level. Bulls were limited by inability to take it to fresh 2016 high this week despite weakening US dollar, as reported by Economic Calendar.
ICE US dollar index added 0.01 percent to 95.20. US dollar is weakening against Japanese yen. USD fell to ¥111.37 from ¥111.54 in North American trading. May copper in Hong Kong fell a penny to $2.2720 a Pound. April platinum eased $6.30 to $964.20 an ounce. June palladium declined $3.20 to $586.85 an ounce.