Gold yesterday opened flat at 28480 and rallied to the new high's of 28599 on renewed euro zone debt fears and weak U.S. economic data.
Strength in the US dollar did little to depress precious metal prices and Gold dipped a fresh low of 28425 to settled at 28451 also some pressure seen from rupee firmness supported by gains in local shares and improved global risk appetite as fears of a possible debt default by Greece eased slightly, although dollar demand from oil refiners kept gains under check.
Credit default swaps also climbed to a record in the struggling nation, indicating a 71% chance the government will default, adding the safe haven.
European leaders meeting in Brussels reached an agreement on a fiscal discipline treaty that includes sanctions for high deficit states and demands members to create laws to limit budget shortfalls.
In addition, the leaders also decided to launch the European Stability Mechanism on July 1st, one year ahead of the original plan.
However, Britain and the Czech Republic refrained from agreeing with the treaty.
Now technically market is trading in the range as RSI for 18days is currently indicating 55.49, where as 50DMA is at 28191.14 and Gold is trading above the same and getting support at 28384 and below could see a test of 28318 level, And resistance is now likely to be seen at 28558, a move above could see prices testing 28665.
Trading Ideas:
Gold trading range is 28318-28666.
Gold settled flat after rallied to the new high's of 28599 on renewed euro zone debt fears and weak U.S. economic data
Credit default swaps also climbed to record in struggling nation, indicating a 71% chance government will default
The leaders decided to launch the European Stability Mechanism on July 1st, one year ahead of the original plan
Courtesy: Kedia Commodities
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