Last week the gold market tested and briefly broke beneath the trend of higher lows from October 2008.
Developing positive news stories are expected to support gold further. Increased global liquidity is expected as the ECB will have to inject more funds in European debt markets. Weak US economic data also helps prolong a reversal in accommodating Feb policy.
However, investor’s willingness to buy dips has not abated and the yellow metal ended the week above the long term trend, registering its second positive weekly performance in succession. This week the important resistances to watch are 1680 and 1696. A break back above here would reinforce last week’s recovery and lift gold to the middle of the trading band since last September’s high at 1908.6 were reached. The trend from 2008 is the major support to watch in April, it lies at 1618.
Elsewhere, most participants in Kitco News’ weekly gold survey look for gold prices to move higher in the coming week.
In the Gold Survey, out of 21 participants who responded this week, 12 see prices up, five see prices down and four say sideways or unchanged. Market participants include bullion dealers, investment banks, futures traders and technical chart analysts.
