International Gold Price likely to Test $950 level
Market reports say that international gold price will likely test $950 level going forward. The positive outlook was born out of the developments last week.
The US core inflation rose last week making the yellow metal as good hedge against adverse price effects driving demand for gold. Other factor that spurted demand was the steps taken by the Chinese government to boost its gold reserve.
According to reports, China has increased its gold reserves 75% to 1054 tonnes recently and has plans to up its reserves further. Another indication of a bullish trend is the renewed confidence seen among gold manufacturers recently, which has resulted in a fall in their hedging positions. Normally gold manufactures hedge against fall in gold prices. The recent positive outlook means that the market is bullish on gold.
Market analysts are of the view that the bullish outlook on gold depends on the increasing chances of an acceleration in US inflation in the years to come. This will fuel an associated unprecedented increase in investor demand for the yellow metal.
The international gold prices ended $931.30 for the June delivery and spot gold closed at $930.70 an ounce. During the last week the open interest was 362,725 , which was down 50% from a year ago. The data showed that long speculators hold 51% of the non-commercial position , while hedgers hold 71% of the total commercial positions.
Analysts see the international gold price to reach $950 levels soon, once breaks out from the near resistance level of $932-$934 range. The immediate support is seen at $925-$917.
As international gold price is poised to climb, its wise to get access to the price fluctuations and gain the benefit out of it. The shortest way of getting access to the positive price situation is to buy gold coins, whose prices will also fluctuate in tandem with international gold prices.
The advantage of gold coins is that you can buy them in smaller units and store them safely. Since the gold coin market is highly liquid, you can dispose of your holding any time you wish convenient to profit out the prevailing higher prices.
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