Gold slumps ahead of the U.S. job reportGold declined for the second day on Friday after the dollar's 0.8% advance yesterday, which sapped demand on the metal as an alternative investment, ahead of the U.S. non-farm payrolls report.
The previous day, gold shed $8.00 or 0.70% to close at $1131.55 an ounce. Gold Price was setin London on Thursday at $1130.25 per ounce during the PM fixing declining from $1130.75 at the AM fixing. SPDR gold trust, the world's largest exchange-traded fund backed by bullion, slipped 0.4% to 1,123.50 metric tons on January 6.
Prices advanced 24% in 2009 and rallied in the first three sessions of 2010, but it stopped rising yesterday as the greenback strengthened versus majors, especially the yen where it rose to the highest in four weeks. The federal currency is expected to continue its upside trend that started in December since the release of the NFP. Analysts are predicting that today's report will show that job losses are going to ease amid the remarkable improvement witnessed recently.
Currently, the U.S. dollar is showing a slight decline as it appears on the six-currency gauge, the dollar index, which retreated to 77.90 from Thursday's closing at 78.00. However, breaching the 77.80 level is anticipated clear the way for another strong rise.
Spot gold is traded at $1125.09 after recording a high $1131.65 and a low of $1119.77, as of 08:20 GMT. Investors are cautious and staying away till the release of the infamous jobs report and as the metal is giving bearish signal as indicated by the Stochastic Oscillator momentum indicator on the daily charts.
On the other hand, oil stopped its incline after reaching its highest level in 14 months above $83 a barrel. The black gold is overbought and may do a downside correction.
With regard to other precious metals, platinum rose to $1539.90 an ounce, recording a high of 1541.40 and a low of $1528.90, while palladium is traded at $423.00, reaching a high of 424.00 and a low of 421.50.