Gold Prices Buck the Dollar
Source: TheStreet, Alix Steel (3/5/10)
"It's very overbought on a short term basis. . .[gold might] test the $1,080 level or so."
Gold for April delivery was rising $3 to $1,136.10 an ounce at the Comex division of the New York Mercantile Exchange. Prices have traded as high as $1,137.50 and as low as $1,127.50. The U.S. dollar index was rising 0.18% to $80.71.
Gold prices were higher Friday after the Labor Department reported that nonfarm payrolls lost 36,000 jobs in February vs. expectations of 63,000. The unemployment rate held at 9.7%, and this news increased investors' risk appetite for commodities, helping gold reverse earlier losses. However, prices were still lower as investors remained skittish. Today's better reading might prompt the Federal Reserve to raise key interest rates sooner than expected, which would pressure prices. Many economists have also been predicting that today's number would be better due to snowstorms, and a true reading might not be available until next month.
Many analysts expect gold prices to correct in the short term. "I think gold is starting to march to its own drummer now," says David Morgan, founder of Silver-Investor.com. "It's very overbought on a short term basis. . .[gold might] test the $1,080 level or so. . .[But] I think that if we can get over [today's] level and stay there on big volume and stay there three days in a row, we're going higher."
Silver prices were rising 14 cents to $17.32 while copper prices were up 4 cents to $3.41.