The gold price was trashed over the last four months of 2016. It had reached a dramatic speculative
top by Jun. - Jul. and this was accompanied by the decline of inflation thrust indicators in the
latter part of the year. Gold Weekly
As the current year has progressed, the US dollar has weakened and the inflation pressure gauges
have been in a bottoming mode. The gold price has advanced fitfully in 2017, and has found
resistance at the $1300 oz. level. The tenuous advance probably needs for the inflation pressure
gauges to strengthen further as the year progresses. The weaker USD has not resulted in a sharp
advance in the important oil price or other key commodity composites and the lack of inflationary
follow-through has generated some gravitational pressure on the gold price.
Gold is not overbought and its 40 wk. m/a has just started to turn positive. However, intermediate
term resistance is formidable at $1300 and gold may suffer if there is another fail in the next few
weeks. Short term, gold can hold its uptrend if it can remain above $1250 on a retrenchment.
Indian markets are likely to extend gaining momentum for the second session on Wednesday, tracking positive cues from Nifty futures on the Singapore Stock Exchange and firm trend across global markets.capitalstars
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