, IncApril 5, 2010 - Strengthened by a weak dollar, the price of gold surged to a two-week high of $1126.10 to top off the opening quarter of 2010. The US dollar was $0.7405 against the Euro, $0.6575 against the British Pound and $1.00 against 94.57 Japanese Yen, against 6.83 Chinese Yuan, against 1.01 Canadian Dollar and against 1.09 Australian Dollar.
Another negative indicator that also helped lift up the price of gold was crude oil prices that rose to $85 a barrel.
Positive indicators as well extended a helping hand to gold – the announcement by the US Labor Department of a decrease by 6,000 Americans lining up for unemployment benefits, the six-year high manufacturing diffusion index reported by Industrial Supply Management (ISM), higher commodities demand worldwide and the general impression of a recovering US economy.
Mark O’Byrne, executive director of GoldCore Ltd. considered the “higher quarterly close …important technically and shows the momentum and the medium- and long-term remain upward.”
An encouraging sustained performance by gold this 2010 has long been awaited by investors. After the record performance in the past decade, investors have been using the closing figure of $1100 as the yardstick to measure gold’s behavior. The figure was dubbed the “psychological level” not just for gold to cross but to keep a safe distance from.
The quarter ending performance was significant because it was a sustained performance that spanned a relatively long period. It was a first for gold in the first quarter of 2010. Gold’s behavior in the past several weeks was nervous and hesitant and eventually dipped below the psychological level at $1073.85. They were weeks of fast-changing investor expectations shuttling between hope and frustration.
The first quarter performance by the price of gold had tilted the balance to hope’s favor.
Ronald Stevens
Senior Staff Writer - GoldPrice.net
