Gold slightly changed in trading Monday
Traders opted to start gold trading in the New Year on low volume, with expectations that the metal will decline in the upcoming period on stronger dollar speculations. Monday trading, which trading day in 2011 witnessed the dollar and gold's trading close to the opening levels.
The U.S. dollar index, which tracks the performance of the dollar against six-majors traded at the opening levels of 79.30, while setting a high of 79.35 and a low of 79.26.
Gold for immediate delivery rose slightly to trade at 1,419.48, compared with the opening levels of 1,418.45 while setting a high of 1,420.32 and a low of 1,413.95.
Gold futures dropped by 0.12% or $1.700 to trade at 1,419.700, while Silver futures gained 0.20% or $0.063 to trade at 31.000 an ounce.
Major Market Movers
Speculations that the dollar will strengthen against majors in the upcoming period is driving commodity traders to remain cautious about trading in the metal, while last year's rally, especially the one witnessed in Friday (December 31, 2010) spurred calm trading by new year as investors may take advantage of price gain and start selling on profit taken techniques.
Today's economic calendar lacks major news from world economies as many central banks in the world are still on holiday due to the New Year celebration. The major highlight of the day will be released by the Euro Zone and the U.S. for the Manufacturing sector's performance in both regions with expectations for increase in activities in both areas.
Silver sales are forecasted to rise in the upcoming period, as investors seek protection from inflation and wealth from the volatility they face in FX-exchange markets.
Silver for immediate delivery traded higher on the daily scale to trade at 30.96 an ounce, compared with the opening levels of 30.86, while touching a high of 31.02 an ounce and a low of 30.57.
Platinum for immediate delivery rose by $12.00 to trade at $1,772.00 an ounce, Palladium rose by $4.0 to trade at $798.00 an ounce.
Technical Analysis for Gold
The pair found strong resistance around the previously breached 38.2% Fibonacci correction that has turned into resistance at 1.3365; therefore, trading remains wedged between 38.2% and 50% Fibonacci till now. The breach of the descending channel's resistance level that organizes trading from levels around 1,428.0, alongside building a base above the MA 50 in addition to stochastic nearing oversold areas are all factors that supports forecast of an expected bullish overall direction this week.