Gold held near a two-week high on Friday and was set to post its strongest week in five as the Federal Reserve's caution over raising U.S. interest rates and weakness in the dollar burnished the metal's appeal.
Spot gold XAU= had eased 0.3 percent to $1,237.10 an ounce by 0048 GMT, but was not too far from a two-week high of $1,243.50 hit in the previous session. For the week, the metal has gained 1.3 percent.
The dollar slumped to a 17-month low against the yen on Thursday on a cautious Fed, while global growth concerns knocked down equities. [MKTS/GLOB]
Minutes from the Fed's March policy meeting released on Wednesday showed policymakers debated whether an interest rate hike would be needed in April, although a consensus emerged that risks from a global economic slowdown warranted a cautious approach.
The solid rally in the gold market Thursday was a feature in the world marketplace. Safe-haven demand again surfaced for the yellow metal as a referendum in the Netherlands on European Union-Ukraine trade relations failed, prompting more concerns about the U.K. referendum in June to opt out of the European Union. A U.K. exit from the European Union could spell the eventual doom for the EU. A weaker U.S. dollar index that hit a nearly eight-month low Thursday was also a positive for the precious metals markets. June Comex gold was last up $15.00 at $1,238.90 an ounce. May Comex silver was last up $0.151 at $15.205 an ounce.
Global stock markets were mostly weaker Thursday, amid the risk aversion on this day. Stock market traders continue to look to the crude oil market for direction. Oil prices were lower Thursday and gave back about half of the strong gains scored Wednesday.
Technically, June gold futures prices closed near mid-range. Gold bulls have the overall near-term technical advantage and are showing resilience. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,250.00. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at the March low of 1,207.70. First resistance is seen at today’s high of $1,245.00 and then at last week’s high of $1,246.80. First support is seen at $1,230.00 and then at today’s low of $1,224.00. Wyckoff’s Market Rating: 6.5
Reference: Reuters, Kitco
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