Gold ticks up ahead of stress tests results

The shiny metal advanced slightly to $1196.06 an ounce on Friday ahead of the release of the awaited stress tests results which will determine the strength of the financial sector in the EU economies, yet the metal remains below strong resistance at $1200.

Yesterday, gold added $8.40 or 0.71% to close at $1185.10 an ounce. Gold Price was setin London on Thursday at $1199.50 per ounce during the PM fixing inclining from $1187.00 during the AM fixing. SPDR gold trust, the world's largest exchange-traded fund backed by bullion, retreated to 1,302.05 metric tons on July 22.

The metal gained support yesterday as the upbeat European data and better-than-estimated earnings boosted demand for equities and commodities, where oil also advanced more than 3% to reach its highest level in 11 weeks.

On the other hand, the U.S. dollar dropped for the first time in three days versus a basket of major currencies as seen by the dollar index which fell to a low 82.45.

However, movements in markets today are still weak as some investors prefer to remain sideline till the release of the stress tests results. Gold has benefited from the financial turmoil in Europe over the previous period which took it to its highest record in June, yet concerns started ease and the euro climbed to two month high against the greenback in July.

Thus, results today may cause fluctuation in markets as good results may damp demand on safe havens and the opposite is true.

This week, gold gained slightly unable to rebound strongly from the drop witnessed over the last four weeks.