Gold Takes Heed From Dollar, Not Greece – Mitsubishi

Washington (Apr 21)  Uncertainty in the eurozone over Greece’s debt has not propelled safe-haven buying for gold, and the metal is expected to take heed from the U.S. dollar’s next moves, says Jonathan Butler, precious metals strategist for Mitsubishi. “Excepting an escalation of the Greek debt crisis, the precious complex’s performance is likely to be determined by the U.S. dollar’s response to upcoming data releases, with housing market and PMI numbers due out in the next two days,” he says in a research note Tuesday. Butler says the yellow metal has been stuck in a narrow range between the 50 and 100-day moving averages, and technical patterns may be pointing to more pressure for the metal. “[T]he bearish pattern formed by the 50-day moving average lying below the 100 dma implying further downside,” he notes. He adds that investor positioning is also neutral to bearish with net longs at just 34% of their all-time high. Finally, recent demand out of India ahead of the gold-buying Akshaya Tritiya festival has helped put a floor for gold prices, however, “going into the seasonally quiet mid-year period demand in India and China could slow.”

Souce: KitcoNews