Futures of gold fell during the trading morning on Monday, retreating from its highest level in seven months in the previous session seven months peak amid uncertainty whether Spain will need a bailout because of sovereign debt crisis as well as continued worries about the outlook for global growth, which increased the anxiety. Boosted demand for the dollar as a safe haven.
On the Comex division of the New York Mercantile Exchange, was first TD Gold futures for October delivery at 762.75 p, $ 1 per ounce during European morning trade, shedding 0.85%.
Earlier in the session prices fell by up to 1% to trade at session lows at 1, $ 759.75. Gold futures rose to the highest level at 787.55, $ 1 per ounce on September 21, the strongest price since February 29.
Gold prices were likely to find short-term support at 751.95, $ 1 per ounce, the lowest price since September 18 and resistance at 792.25, 1, dollars per ounce, the highest price since February 29.
Investors remained cautious where he was scheduled to play Madrid introduced a draft annual budget for next year on Thursday, and announced structural reforms, while will show the bank stress test results on Friday. In addition, it is expected that the ratings agency Moody’s to complete the review of assessments in Spain later this week.
Over the weekend, said Spanish Economy Minister said his country would not seek to rush to the request of external financial aid, with the growing pressure on Spain to search for a rescue plan.
At the same time, Greece still a source of concern for investors after its finance minister denied a report from the German media that the country’s budget deficit could reach 20 billion euros, almost twice as much as previously thought.
Earlier in the day, meeting minutes showed the Bank of Japan for the month of August that the decision-makers expect Japan’s economy recover and return to Amsarh moderate in terms of turnout on domestic demand and improved demand from foreign economies.
The bank added that exports have slowed down in recent months due to the slowdown of other economies, especially in Europe.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, rose 0.25% to trade at 79.65.
The strength of the U.S. dollar usually affect gold, because it alleviates the metal’s appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
The precious metal rose in the past amid monetary stimulus measures. Investors tend to turn to gold amid fears of excess liquidity will lead to the erosion of the value of paper currencies and lead to inflation.
Gold futures gained nearly 10% since the beginning of August, supported by the recent stimulus efforts by major central banks around the world.
Elsewhere in the Comex, silver for December delivery fell 0.8% to trade at 34.31 dollars per ounce, while copper fell for December delivery rose 1.75% to trade at $ 3.748 a pound.