comex gold intraday

Gold Outlook
21 May 2008 11:09:11



Gold prices continued to escalate, and traded above $920 yesterday, supported by weakness in the dollar and oil’s extended rally to new highs.



International spot gold traded in the range $902.40 - $923.40 and last quoted at $918.35 ($903.95).



Traders were cautious ahead of the release of the minutes from the Federal Open Market Committee's April 29-30 meeting, which is scheduled for release today.



The dollar had edged higher on Monday after the index of leading economic indicators in US showed a rise for the second straight month in April. The index rose 0.1% in April, identical to the gain in March after falling for the five prior months.



But on Friday, a more-than-expected fall in US consumer sentiments had renewed concerns about the economy. The University of Michigan’s Consumer Sentiment Index in May fell to 59.5 from 62.6 in April against the expectation for 61.0.



According to the data released by US Labor Department on Thursday, the number of people filing for the first time for unemployment benefits rose 6,000 to a seasonally adjusted 371,000 in the week ended May 10. But the four-week average of initial claims fell 1,000 to 365,750.



The continuing claims also recorded an increase, by 28,000 to 3.06 million in the week ended May 3; while the four-week average of continuing claims increased by 15,250 to 3.02 million.



The data from US Labor Department released on Wednesday showed that inflation had moderated in April, with the Consumer Price Index recording a rise of 0.2%.



Mean while, stronger-than-expected GDP data from the euro-zone provided support for the Euro. The European Union's statistical agency Eurostat reported that gross domestic product across the 15-nation euro-zone expanded at a 0.7% quarterly pace in the first three months of the year, gaining 2.2% year-on-year.



Federal Reserve Chairman Ben Bernanke in a speech last week had said that the US central bank's efforts to provide liquidity to financial markets in an effort to alleviate the credit crunch had helped but that markets remain stressed.



As per data released last week, US retail sales fell by a seasonally adjusted 0.2% in April, following a 0.2% gain in the previous month. But it was slightly stronger compared to the expectation for a 0.3% drop.





Crude oil July in NYMEX traded as high as $129.60 a barrel and settled at $128.98 ($127.05).



Oil prices thrived on potential supply threats due to geo-political tensions, expected demand from China and OPEC’s unwillingness to increase output despite high oil prices.



Last day DGCX Gold June traded in the range $904.00 – $923.40 and closed at $919.70 ($906.50).



TECHNICAL OUTLOOK (Intra-day)

GOLD (June) - Bullish above $ 919.00; bearish below $ 914.50

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