Gold Set for Fifth Straight Week of Gains

Gold Hourly

Gold Hourly

Spot gold had edged up 0.5 per cent to $1,328.84 an ounce by 0703 GMT, after earlier touching its highest since September 15 at $1,330.34. Gold is up 0.5 percent for the week so far and the streak of weekly gains is the most since the week ending April 14. The U.S. dollar fell to 0.9778 Swiss franc from 0.9832 Swiss francs, and it moved up to 1.2575 Canadian dollars from 1.2459 Canadian dollars.

The yellow metal rose for its third session in a row, reaching $1,333.10 a troy ounce as the dollar index, which measures the greenback against a basket of currencies, dropped to as low as 91.3080.

The euro jumped against the dollar as the European Central Bank signaled it could begin to wind down its 2.5-trillion-euro ($3.01-trillion U.S.) stimulus program this year.

A stronger euro potentially boosts demand for gold by making dollar-priced bullion cheaper for European investors.

"There is a lot of doubt on how long prices have run from here. Prices have risen despite the Fed raising interest rates and the main driver has been the USA dollar, which we continue to see help gold run higher in the first quarter", said Brian Lan, managing director at dealer GoldSilver Central in Singapore.

"Gold has to breach the recent high of $1,327, above which prices can touch $1,360".

Spot gold is expected to test resistance at $1,329 per ounce, with a good chance of rising more to the next resistance level at $1,341, according to Reuters technical analyst Wang Tao. This goes against convention and fundamentals and it is indeed a surprise that the gold prices are here with the stock markets making all time highs around the world, the crypt industry doing decently well and the demand for gold having hit a plateau over the past year or so but then, this is the market and generally there is not much logic into what goes on in the markets in the short term.

Among other precious metals, spot silver rose 0.8 per cent to $17.11 an ounce. Silver is on track for its first weekly loss in five weeks, down 0.6 per cent so far this week. It has risen 1.7 percent so far this week.