FXS: Gold extends gains to 1-week high after US data
FXstreet.com (Córdoba) - Gold extended gains into a fourth consecutive day, accelerating higher after US reported retail sales and producer price index fell more than expected in May. The drop in prices opens the way to the Fed to embark on another round of monetary easing without concerning about inflation.
Gold climbed to a 1-week high of $1,624 an ounce after the data and it is currently trading at $1,620 an ounce, up 0.7% on the day.
"We think that current strength of gold price results from the fact that market bets on a further round of monetary easing from major central banks which seems to be more and more likely scenario (especially in light of recent situation in the euro zone)", said KBC Market Research Desk.
From a technical perspective, "The uptrend may be expected to continue in case the market rises above resistance level 1616, which will be followed by reaching resistance level 1630", says Anton Kolganov, analyst at ForexMillion. "A downtrend will start as soon, as the pair drops below support level 1602".
