IV:Gold remains steady though rally wanes ahead of U.S. jobs data
Investing.com - Gold prices remained higher in afternoon trading on Monday on the end of a rally, as investors looked past bullish pressures stemming from a government shutdown and ahead to the September jobs report, which markets hope will shed light on the fate of Federal Reserve stimulus programs.
Stimulus tools often weaken the dollar to drive recovery, making gold an attractive hedge.
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,315.90 during U.S. afternoon hours, up 0.10%.
Gold prices hit a session low of USD1,312.80 a troy ounce and high of USD1,323.90 a troy ounce.
Gold futures were likely to find support at USD1,251.10 a troy ounce, Tuesday's low, and resistance at USD1,324.10, Thursday's high.
The December contract settled down 0.63% at USD1,314.60 a troy ounce on Friday.
Gold prices shot up in recent sessions amid expectations for the Federal Reserve to continue stimulating the economy to offset the effects a recent government shutdown may have had on recovery.
The Fed is currently buying USD85 billion in Treasury holdings and mortgage debt a month to boost the economy, a monetary policy tool known as quantitative easing that drives down interest rates to spur recovery, weakening the dollar in the process, thus sending gold rising as a result.
The government shutdown and accompanying default fears along with the naming of dovish Janet Yellen as the new Chair of the Federal Reserve left may investors guessing when the U.S. central bank will announce plans to taper its quantitative easing program, which could push the dollar up in the long term and chip away at gold prices.
Investors hope the September jobs data, originally due out Oct. 4, will provide a fresh weather vane for the precious metal.
Elsewhere, lackluster data out of the U.S. housing sector kept expectations going for the Fed to put off tapering stimulus measures until early 2014, which gave gold support.
The National Association of Realtors reported earlier that total existing home sales declined 1.9% to a seasonally adjusted annual rate of 5.29 million units in September from a downwardly revised 5.39 million in August, mainly due to home prices outpacing income growth.
Analysts were expecting to see 5.30 million units sold.
Elsewhere on the Comex, silver for December delivery was up 1.61% at USD22.265 a troy ounce, while copper for December delivery was up 0.15% and trading at USD3.304 a pound.
