Gold climbed to the highest level of the day to settled with a gain of +0.64% at 28357 as the dollar weakened after ECB President confirmed reports that Greece had finally agreed on a package of austerity measures.
According to government sources, Greek PM Lucas Papademos declared that an agreement was reached and endorsed by the major Greek political parties on a set of new austerity measures needed in order to secure a second bailout package.
ECB President Draghi later confirmed the news at his press conference after the ECB’s policy meeting, in which it kept interest rates on hold at 1%.
Gold prices found additional support after the BoE increased its QE program by GBP50 billion earlier, citing the "significant margin" of slack in the British economy and left interest rates unchanged at 0.5% in a widely expected decision.
Gold can benefit from such an environment of easy money because of expectations that ample liquidity would put a damper on the value of paper currencies.
Now technically market is trading in the range as RSI for 18days is currently indicating 53.58, where as 50DMA is at 28008 and Gold is trading above the same and getting support at 28199 and below could see a test of 28041 level, And resistance is now likely to be seen at 28513, a move above could see prices testing 28669.
Trading Ideas:
Gold trading range for the day is 28041-28669.
Gold climbed as $ weakened after ECB President confirmed reports that Greece had finally agreed on package of austerity measures
South Africa's gold output fell by 8.2 percent in volume in December
SPDR gold trust holdings gained by 1.21 tonnes to 1278.34 tonnes.
Courtesy: Kedia Commodities
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