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10.01.2008 - GOLD reaches all-time high

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Date: 2008-01-10 15:54

Gold is on its quest towards the 900 USD per ounce level. Yesterday early in the morning it broke 890 USD, a new all-time high. The difficult situation on the global financial markets is causing investors to look for alternative forms of investment.

During hard times gold is the most sought financial instrument. Increasing global risk aversion makes investors more keen to invest in gold pumping its price. Yesterday morning gold broke the 890 USD per ounce barrier for the first time in history reaching 890.98 USD.

Since yesterday gold is declining and is being quoted around 875 USD per ounce. The decrease is mainly attributed to the strengthening American dollar, which is negatively correlated with the yellow metal. The EURUSD after achieving 1.4740, dropped today to 1.4675.

The gold market is in a strong increasing trend since august. After breaking off from the triangle formation at the end of December, it reached exactly 161.8% of the triangle’s height (Pic 1) on a daily interval. The closest support level is at 845 USD. Much will depend on the EURUSD, which is still over 1.46 but declining to 1.43 (important support level for the EURUSD) can push gold to test 845 USD.

Pic 1


Adam Narczewski