GOLD ‘MAY ADVANCE TO $1,252’ AN OUNCE

by Goldline.com | August 26, 2010

Gold prices are consolidating on the New York Spot Market as of 10:57 a.m. EST as U.S. weekly initial jobless claims were better than expected, fueling investors' risk appetite. Gold prices are expected to be on hold heading into Friday when the Department of Commerce delivers its second estimate on second-quarter gross domestic product and Federal Reserve Chairman Ben Bernanke kicks off a two-day meeting of world central bank leaders in Wyoming. Investors will be looking for hints of further quantitative easing. (The Street, 8/26/10)

Stocks are higher on the New York Stock Exchange as investors welcomed a better-than-expected report on jobless claims. Gains are likely to be tempered as investors may take a cautious stance ahead of the latest reading on second-quarter gross domestic product due early Friday. The GDP, the broadest gauge of the economy, is expected to show the economy grew much less than previously estimated. (CNN Money, 8/26/10)

Gold may advance as high as $1,252.35 an ounce, as long as prices do not drop below the 55- day moving average for two consecutive days, according to a report from Commerzbank AG technical analyst Axel Rudolph. “Spot gold is starting to slip out of its one-month uptrend channel and may revisit the 55-day moving average,” Rudolph wrote in the report. “The $1,250.45/$1,252.25 resistance area, containing the May and early-June highs as well as the 1.618 percent Fibonacci extension of the February-to- March advance, remains our upside target.” (Bloomberg, 8/26/10)

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