U.S. Data Powers Demand for Precious Metals

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"Precious metals insist on moving upwards, where the upside medium-term direction is bullish"

Although the U.S. economy is moving further away from the recession and achieving growth, this does not negate the fact that the road to recovery for the economy still remains far, even though data yesterday pointed to strong growth in the manufacturing sector, with an unexpected rise in pending home sales. All this positive data was the reason behind pushing traders to expect more demand on commodities and services, causing an overall commodity demand wave, where precious metals gained a part of it as well.

Gold gained in yesterday's trading session, where it closed at $1,059.60 gaining 1.43%; silver rose 0.80% and closed at $16.45; whereas platinum gained of $11/oz., where it closed at $1,335.00 rising 0.83%.

Today's focus was set on the major plunge Hang Seng Index faced, despite some Asian stock indices also falling; whereas precious metals continued to gain due to demand every once in a while from numerous speculators and investors. However, gold managed to rise today once again, where it is currently trading at a clear high; meanwhile silver rose and is trading at 16.53, inclining by 0.49%; platinum followed by gaining, reaching $1,343/oz.

However, yesterday's trading session witnessed gold gaining more than any other precious metal, thus showing us there are strong speculations mixed with investments in the market that came alongside demand for a safe haven.

Australia raised its benchmark interest rate to 3.5%, causing more demand on gold as the Australian dollar is enjoying a higher return, which in its turn is attracting investors to buy gold due to request for the Australian dollar, and selling low-yielding currencies.

Precious metals insist on moving upwards, where the upside medium-term direction is bullish, specifically on gold, as prices are seen above $1,100/oz.; whereas the short-term and intraday direction may both witness major fluctuations if speculations remain strong in financial markets.

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