Gold creeps higher

The $1240 level continues to offer solid support to the gold price as it adds to its efforts to head higher. 

Gold bars
Source: Bloomberg

As I wrote about last week, support for the gold price has materialised around $1240, with the spot price making gradual progress up to $1280. A healthy portion of credit for today’s move by gold can be taken by US dollar, which has strengthened against both the euro and the pound.

The fundamental picture for gold has not really changed over the last week. The situation in Ukraine is still far from ideal, but the imminent threat of military action has reduced. Although the Russian and Ukraine delegates are far from agreed over the pricing structure for energy supplies to Ukraine, they are at least sitting around the table to discuss the matter. The new government in India is still in the early days of its reign and could well instigate a new policy as far as the taxing of gold imports is concerned.

Though the yellow metal continues to keep itself afloat, and may edge higher still, I still believe that it will struggle to break any higher than the $1280 region.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.