Some profit-taking by short-term investors continues to weigh on Gold

Some profit-taking by short-term investors continues to weigh on Gold. Nevertheless, light buying is evident on dips (especially in gold) which is keeping prices in a relatively tight range. With no news on developments in the MENA region most investors are waiting on the sidelines. There has been no change in physical market activity, which remains lacklustre even though prices have moved lower.

However, given the poor performance in equities across the globe, it is safe to assume that risk aversion is still in play. As such, we still see the potential for upside in precious metals (especially gold and silver) as long as the situation in Libya remains unresolved.

Gold support is at $1,424 and $1,417. Resistance is at $1,439 and $1,445