(OroyFinanzas.com) – There was very little interest in gold overnight as Japanese were out due to the Golden week. The yellow metal opened above $680 on the electronic trading, but got capped around $681.50 per ounce by profit taking.
After the opening of London selling persisted, forcing the prices down to $676.30 and subsequently fixing at $678, up 5.5 dollars from the previous AM. The precious metal then turned around and gradually regained ground. After the opening of the Comex division of the New York Mercantile Exchange the first set of US economic data came out. The country’s income rose a greater than expected 0.7 percent in March, while core consumer prices were unchanged. The core prices from the same month a year ago eased to a 2.1 percent, while the overall prices posted their largest gain since August, rising 2.4 percent from a year ago. US dollar retreated slightly as inflation worries eased a little, which allowed gold to break above the$680 resistance level again.
Technical selling however once more did not let the metal to sustain that level. Prices revisited the bottom side of the intraday range two hours later despite the National Association of Purchasing Management Chicago business barometer falling to 52.9 in April verses a reading of 54.00 anticipated. The weaker index was partially due to the sharp growth pull back, but as soon as it is above 50 it is still indicating expansion. The US construction spending rose 0.2 percent last month as projected, with the February data upwardly revised. Selling interest was seen the second London fix. Prices started trying at $678, butin the absence of buyers we eventually fixed a dollar below the starting point. The yellow metal was extremely quiet, spending the last couple of hours of NY trade hovering below the $681 level which seemed to attract substantial selling orders and capping the upside. We continue to believe that gold could be vulnerable to further correction if the $670 level fails to hold. On the other hand we would need some more positive sentiment fromthe market players in order to breach the resistance around $681-682 levels followed by $690.
Silver also firmed after the market closed Friday with the prices reaching a peak of $13.54 and seeming to find support just below the 13.50 dollar mark. During our time zone the overnight range was extended on the downside. The white metal was sold down to $13.42 levels several times during the day, but every time found enough short covering interest to rebound back to around $13.50 per ounce. We believe that further downside cannot be ruled out, especially if silver fails to sustain the $13.40 support.
MKS Gold & Silver, Daily Report
By Lidia Nazarova
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