On Tuesday the gold is traded under 1200 $, as the significant strengthening of the US dollar reduced the appeal of the precious metal.
During the European morning, the New York COMEX gold futures for June rose by 60 cents, or 0.05%, the price now reaching 1194.30 $ per troy ounce. The futures are traded in a narrow range between 1192.70 and 1196.50 US dollars.
A day earlier, the gold price fell with 9.40 $, or 0.78%, getting to 1193.70 $. Futures are likely to find support at 1183.50 $, the minimum on April 14, and resistance at 1210.60, the maximum of April 10. More than this, on the COMEX, silver futures for May delivery fell 5.9 cents, or 0.37%, reaching 15.94 $ per troy ounce. Yesterday, on Monday, the silver price fell to 15.82 $, the lowest level since March 19.
The USD index, which measures the strength of the US dollar against the set of the six major currencies, rose 0.5%, which means it got to 98.65. The strong US dollar usually puts pressure on gold, as it reduces the attraction for metals as alternative assets and increases the prices of dollar-denominated commodities for holders of other currencies. The US dollar keeps its strong position after a negative trend against other major currencies in the last week, when a series of poor US economic data prompted investors to reduce expectations regarding the time when the Federal Reserve System will increase the rate.
#ufxgoldbr300x250#Meanwhile, there are many concerns and worries about the lack of an agreement between Greek government and its external creditors on economic reforms, which is necessary for the provision of financial assistance. Now all the focus of the investors stays on Greece, because there are real fears that Greece may be forced to leave the Euro zone. This situation dramatically influences the EUR/USD position, and the dollar looks very strong now compared to the weakening and threatened Euro.
In addition, copper for May delivery fell 2.5 cents, or 0.91%, getting to 2708 $ per pound. On Monday, copper fell 4.1 cents, or 1.5%, under the pressure of the worries about bond default in the construction sector in China. Kaisa Group Holdings, located in Shenzhen, became the first Chinese developer that defaulted on its dollar bonds. The company confirmed that it was unable to pay obligations for two older notes on Monday. The concerns about bond default led the investors to fears that deals of massive amounts of copper cannot take place. China is the world’s largest consumer of copper. It accounted for almost 40 % of world copper consumption last year.