Gold price ticks higher as Brexit due to be triggered

London (Mar 29)  Gold edged higher on Wednesday as uncertainty about Brexit talks, French elections and U.S. President Donald Trump's economic policies boosted safe haven buying, offsetting a firmer dollar.

Spot gold was up 0.1 percent at $1,252.35 per ounce at 1122 GMT. U.S. gold futures slipped 0.3 percent to $1,252.      

"The general picture is still positive with dips seen as buying opportunities," said Carsten Fritsch, analyst at Commerzbank in Frankfurt.

"There are a lot of uncertainties regarding the Trump reflation trade after the failure last week to overhaul
Obamacare and uncertainty in Europe with French elections coming
up and the official start today of Brexit negotiations."
    Prime Minister Theresa May will file formal Brexit divorce
papers on Wednesday, pitching the United Kingdom into the
unknown and triggering years of uncertain negotiations that will
test the endurance of the European Union.            
    Capping gains, however, was a firmer dollar       , which
pulled away from 4-1/2 month lows, along with strong technical
resistance, analysts and traders said.
    "A resurgent U.S. dollar, along with higher U.S. yields and
equities has taken the momentum out of the gold rally for now,"
said Jeffrey Halley, senior market analyst at OANDA.
    The metal was also under pressure after failing to break
through its 200-day moving average at $1,260, Halley said,
posting its second consecutive down day in Asia.
     A strong greenback makes dollar-denominated gold more
expensive for holders of other currencies, potentially
decreasing demand.         
    Meanwhile, holdings of SPDR Gold Trust      , the world's
largest gold-backed exchange-traded fund, which is considered a
gauge of investment demand, reported an outflow of 1.8 tonnes on
Tuesday.         
    "As for the balance of this week, we think that gold will
stabilize and possibly push higher given that Tuesday's advance
in equities did not have much of an impact in slowing its upward
momentum," INTL FCStone analyst Edward Meir said in a note.
    "In addition, technicals still look constructive, just as
physical demand seems to be improving, particularly out of
India."
    In other precious metals, palladium prices        were down
0.3 percent to $790.47 an ounce, after touching a two-year peak
of $815.40 on Friday.
    "It seems that demand from the auto industry is still
strong," said Fritsch, referring to platinum's main use for
vehicle catalytic converters to curb exhaust pollution.
    "We've seen a pullback, but it found support at $790, so it
looks like it's a consolidation not a stronger correction."
    Spot silver        slipped 0.1 percent to $18.14 per ounce.
In the previous session, the metal hit $18.24, the highest since
March 2. 
    Platinum        rose 0.3 percent to $951.74 per ounce.

Source: Reuters