Gold softer in London morning trade, tracks oil lower

London (Platts)--11Oct2006

Gold was indicated lower in London morning trade Wednesday, tracking oil
lower. Spot bullion was bid at $571.65/oz at 0918 GMT Wednesday, slipping
$0.45 from its late New York spot price and little changed from its London
afternoon close Tuesday of $571.40/oz.
Bulliondesk.com analyst, James Moore, said in a report Wednesday morning
that rumors of a second nuclear test by North Korea "prompted some initial
buying interest in gold this morning although this was soon reversed on oil
weakness/dollar strength."
"Given the correlation with oil at the moment I think it only a matter of
time before we see gold dip back to $550, or potentially the June low of $542,
however I think we are approaching the end of the correction and should soon
see prices recover," he said.
Standard Bank London said in a website report that as the frenzy
surrounding North Korea subsided, "gold should resume its interim weak trend,
targeting immediate support of $570 and $562, with potentially a move towards
$542 and $535." The bank said resistances at $580/oz and $600/oz would likely
cap prices for the moment.
Meanwhile in the currency markets the euro was indicated at $1.2548 up
marginally from $1.2530 on Wednesday afternoon.

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