Gold price at 3.5-month high
Gold’s start into last week was initially subdued, with the week’s low being marked at 1,226 $/oz on Tuesday. There, the yellow metal changed gear and was not stopped for the rest of the week. It recorded a price increase of approximately 2.8% until Friday, and with 1,260 /oz climbed to the highest level since November 2016. This increase did not go unnoticed by investors in the Euro area either, where Gold also reached a 3.5-month high with a rise by more than 26 €/oz to 1,190 €/oz. Several price drivers can be held responsible for this move. The debate on the US's nuclear rearmament on Friday, the continuing uncertainty regarding US domestic and foreign policy as well as the Fed's disagreement regarding the timing of the next rate hike in the Dollar zone are all lending support to Gold. Persistent speculation about Greek fiscal policy and looming elections in The Netherlands and France are contributing to the geopolitical uncertainty on the part of the European continent. This is reflected in the increase in ETFs, which rose by over 3% in February. In principle, we continue to see Gold well supported – overcoming resistance at 1,249 $/oz may suggest higher prices. We see the next resistance level at 1,278 $/oz and also the 1,300 $/oz mark is moving into the sight of investors. Short-term profit taking could, however, somewhat slow the current uptrend.