Gold has steadied at $1620 as markets look forward the US Federal Reserve meeting on Tuesday and Wednesday for further signals on QE3 to bolster economic growth. Investors are also eyeing the European Central Bank meeting on Thursday for pro-growth measures.
On Monday trading spot gold is already up at $1623 an ounce after posting a weekly gain of 2.5%. The Eurozone uncertainties and slowdown in emerging economies have provided support for the yellow metal but in recent months prices have hovered around $1525 and $1640.
Gold has traded has crossed the 100 day moving average in the weekend and looks poised for further upward movements. Large funds have already invested in gold hoping for QE3 to unfold.
“Gold appears near term bullish and crossing above 200 day moving average at $1640 levels can push gold higher but key resistance levels at 1650 and 1675 may appear formidable for the yellow metal,” according to Sreekumar Raghavan, Chief Commodity Strategist at Commodityonline.
At India’s Multi Commodity Exchange, October Gold closed sharply higher on Saturday and support levels at 30,025, 29,780 and resistance levels at 30,390 and 30630, according to a weekly Angel Commodities.
Physical gold demand in the Asian region remains weak but Indian festival demand from August for precious metals may help push both silver and gold higher, rupee depreciation may impact market sentiments. Large hedge funds in US who had gone long on gold in recent months have trimmed their net long positions in futures and options for the week ended July 24 by around 25%.
