Gold climbs higher, supported by weaker dollar and firmer oil

London (Platts)--27Mar2007

Gold was indicated higher in London morning trade Tuesday, bouncing up
more than $2 higher than its Monday afternoon fix, supported by continuing
geopolitical tension in the Persian Gulf, a weaker dollar and firmer oil,
analysts said.
Gold fixed at $665.15/oz on Tuesday morning, gaining $1.35 from its late
New York spot price and up $2.15 from its Monday afternoon fix in London.
Standard Bank London said in a morning website report that continuing
tensions in the Persian Gulf provided for a firm sentiment and these factors
helped gold to a high of $664.20 bid before consolidating for a close at
$663.40 bid during New York trade. "Overall, gold showed some resilience in
shrugging off the long liquidation disappointment in pre-weekend trading and
resumed its rise at the beginning of this week," the bank said, adding that
resistance should continue to exist scaled-up from the higher-$660's to
$672/oz, "but it is expected a period of consolidation in the $660's could
eventually provide a strong enough base for the metal to work from to break it
down."
Bulliondesk.com analyst, James Moore, said resistance had proved strong
around $664-66/oz although the weak dollar/high oil scenario remained
supportive for further gains. "Conditions are set to remain volatile with the
approach of month/quarter end with successful clearance of the $666 resistance
area enabling the metal to rally, targeting initial resistance at $672 before
moving on to challenge the February high around $689," said Moore.
In the currency markets, the euro was at $1.3344 at 1103 GMT on Tuesday,
up slightly from $1.3330 at 1600 GMT on Monday. The yen was indicated at Yen
118.19, losing against the dollar from Yen 117.80 on Monday afternoon.