Gold futures continue to add gains

US Gold prices stabilized this Wednesday after soft German business confidence data initiated a growing number of market traders to take up gold positions amid endorsing speculation that of a European Central Bank rate cut, which typically weaken paper currencies and make gold an attractive hedge.

After official US data showed that durable goods orders dropped unexpectedly this March, while core orders dropped, enforcing concerns over the US economic outlook, gold futures continued to rise sharply, adding to high gains.

Physical demand for the precious metal pushed prices further as well. Gold futures continued to gain support from indications of strong physical demand for the precious metal.

On the New York Mercantile Exchange Comex division, gold futures for June delivery increased 1.03% to 1,423.25 USD a troy ounce in US trading this Wednesday, up from a session low of 1,411.65 USD and down from a high of 1,432.65 USD a troy ounce.

Gold futures were likely to test resistance at 1,438.35 USD a troy ounce and support at 1,403.55 USD.

Elsewhere on the Comex, silver for May delivery increased 0.07% to 22.833 USD a troy ounce, while copper for May delivery added 2.15% and traded at 3.159 USD a pound.

The US Commerce Department announced in a report earlier today that core durable goods orders, excluding volatile transportation items, dropped by a seasonally adjusted 1.4% this March, compared to expectations for a 0.5% increase.

Total durable goods orders, including transportation items, dropped by a seasonally adjusted 5.7% last month, more than expectations for a drop of 2.8%.

Elsewhere, the IFO index of German business climate dropped to a four month low of 104.4 in April from 106.7 in March. Analysts had speculated that the index will tick down to 106.2.

The European Central Bank announced it will hold a monetary policy meeting on May 2nd.


Leave a Reply