NEW YORK (TheStreet ) -- Gold prices were trading higher Friday as global economic worries and weak equity markets propelled investors into the safe haven asset.
Gold prices for December were adding 70 cents to $1,217.40 an ounce at the Comex division of the New York Mercantile Exchange. The gold price today has traded as high as $1,219.80 and as low as $1,213.50. The U.S. dollar index was adding 0.12% to $82.71 while the euro was losing 0.28% to $1.27 vs. the dollar. The spot gold price Friday was up $2.70, according to Kitco's gold index.
Continuing weak job growth in the U.S. as well as comments from the European Central Bank that European Union growth will be subdued for the next two years were reigniting fears of a double dip recession and leading a surge into gold.
Stocks have taken a beating this week with the Dow Jones Industrial Average slipping into negative territory for the year while gold prices rose 0.86% as investors piled into the metal. The popular gold ETF SPDR Gold Shares(GLD) added almost 4 tons this week.
Investors buy gold during times of economic uncertainty as a place to preserve wealth until equities recover. The U.S. dollar and yen have also been targeted as safe havens. The yield on the 10-year U.S. Treasury bond was at 2.74%.
Gold prices have conquered the $1,200 resistance area and are now targeting the $1,230 level. This rally might change the gold game if prices can "overcome resistance at $1,233, $1,235 area," says Jon Nadler, senior analyst at Kitco.com.
A stronger dollar, however, could drag on gold prices as investors dump the euro for a "safer" currency. A stronger dollar makes gold, a dollar backed commodity, more expensive to buy in other currencies. Gold and the U.S. dollar buck this inverse correlation during times of major market panic, but any substantial rise in the dollar could curb enthusiasm for gold.
