Gold advances as European lawmakers fail to ease rising debt concerns
At the beginning of a new week, the shiny metal provided a bullish opening gap after starting the Asian session, where gold is mainly affected by the worsening and deepening debt crisis in Europe, where European lawmakers failed to ease rising debt concerns and jitters in the market after they reached no agreement in regards to providing Greece with the next tranche of 2010's bailout package.
Gold advanced today after the opening gap seen, where after the closing in New York on Friday at $1810.20 per ounce, the metal opened the session today at $1816.32. Gold also recorded an intraday high at $1827.88 and an intraday low at $1814.05, and is currently trading around $1823.60 per ounce.
Over weekly basis, the metal closed last week lower, extending the losses recorded in the week before, where the metal opened the week at $1860.65 per ounce, and rebounded slightly to record a high of $1862.42 and then reversed sharply to the downside reaching a low of $1762.42 per ounce.
Europe remains the main focus in the market, especially after European finance ministers failed to calm rising concerns and renewed fears regarding Greek default, where investors were disappointed after lawmakers delayed the decision on handing Greece the next tranche of the last bailout package till October.
Pessimism returned to dominate markets, after investors' expectations for Greece diminished, where movements taken by the European Central Bank, the Swiss National Bank, the European Commission and several governments in the zone raised expectations and optimism that lawmakers have finally found common grounds to overcome the worsening debt crisis and they will use their different and several tools to provide financial stability to European and global markets; however, the finance chiefs come to disappoint investors and trigger more volatility.
Asian and European equities reflected negativity and pessimism in the market, as we can see all main indices are trading or closed in red; moreover, the U.S. dollar also provided an opening gap today, reflecting rising demand for safe havens.
Poor fundamentals are to be released today, however during this week, and precisely on Wednesday, investors are waiting for the Bank of England Minutes in addition to the FOMC rate decision, which are the main events this week, awaiting the steps taken by the Federal Reserve after the downbeat economic data, where expectations are pointing at further stimulus and monetary policy easing.
We expect gold to fill the opening gap seen today before taking a clear path, where volatility and fluctuations are possible during the session, but the metal's general trend is to the upside.
We see silver is trading narrowly today, where the metal opened the session at $40.64 per ounce, and recorded a high of $40.80 and a low of $40.47 and is currently trading around $40.54 per ounce.
Among other precious metals, platinum trades now around $1812.00 per ounce, after opening the session at $1802.00. The metal set the highest at $1816.00 and the lowest at $1794.00 per ounce.