Over the past two weeks, the gold price had fluctuated between $1300 and $1330 as the post-Brexit rally appeared to stall a bit from its move towards $1400 per ounce. But as we noted here in a previous post, the lull in gold moving higher appeared to be due to the markets waiting for buyers to fill the gap, and sellers to finish taking some profits.
Since the end of last week, gold has moved back up over $1350 and is on its way towards crossing the two year high of $1374 that it achieved within the past two months. And if it can sustain that price, there is little resistance between here and around $1420.
Gold traded at a three-week high in London Tuesday on the back of a weaker dollar and uncertain timing for a rate increase by the US Federal Reserve.
Spot gold traded up 0.40 per cent at $US1.358.78 per metric ton in midmorning European trade, its highest point since July 11.
The WSJ Dollar Index, which measures the dollar against a basket of other currencies, was trading down 0.33 per cent on Tuesday. A weaker dollar makes dollar-denominated commodities, including gold, more affordable for investors who hold other currencies.
Gold has risen in recent days on the back of a weaker-than-expected 1.2 per cent growth in the US gross domestic product in the second quarter. - The Australian