The dollar's rebound stalled gold's rally
Precious-Gold dropped on Monday after gains generated last week as the U.S. dollar rebounded from near its lowest level this year, eroding demand on commodities especially bullions.
Last Friday, gold added $8.70 or 0.87% to close at $1006.00 an ounce. Gold prices were setin
The previous week gold advanced 1.13% and managed to close above $1000 an ounce for the first time since 18 months on optimist in markets with regard economic recovery which boosted demand on higher-yielding and riskier assets and therefore reducing demand on the green currency; the thing that gave the chance for gold to visit the $1000 levels again this year.
The federal currency lost more than 5% this year as indicated by the dollar index which tracks the dollar's movements versus six major currencies. With the ongoing improvement and cheerful outlook on the back of the upbeat data released by major economies, the U.S. dollar and yen retreated as refuge assets. However, the dollar rebounded today on technical movements as it became oversold.
Investors sold the metal as it hit the $1000 to cover their positions, while some traders preferred to sell and take profits after last week's rally. Some analysts are predicting that gold is now taking a breath before rising again above $1000. However, this will depend on the dollar's rebound and its length and strength. The U.S. dollar gained 0.4% today after dropping for six consecutive days, and it is now at 76.94 compared with the opening at 76.61.