Gold Starts July In Good Mood

Gold......
Gold futures began the month of July in a good mood after losing more than $200 to the low of $1179.4 an ounce triggered by growing expectations the Federal Reserve will begin to taper off its bond-buying program by the end of this year. The weakness in Asian equities is also providing some boost to the yellow metal.
Asian markets on Monday began a new quarter on a weak footing as a further slowdown in manufacturing activity in China, South Korea and Taiwan raised concerns about the health of those economies.
Australia’s S&P/ASX 200 tumbled 1.6% as the country began a new financial year. Japan’s Nikkei Stock Average gave up 0.5%, South Korea’s Kospi lost 0.2%, and Taiwan’s Taiex shed 0.3%. China’s Shanghai Composite dropped 0.4% in choppy trading, resuming its downtrend after snapping a seven-day losing streak on Friday. Hong Kong markets were closed for a holiday.
Gold futures for August delivery are trading up $ 17 at $ 1241 per ounce on the Comex division of the New York Mercantile Exchange. The metal may find support near $1180 levels- nearly 3 year low level with resistance near $1215 levels. Gold lost 4.8% on the week.
For the quarter, the precious metal declined nearly 23%, the largest quarterly loss on record, amid speculation the Fed will start to unwind its bond purchasing program in the coming months. Gold prices are on track to post a loss of 27% on the year, the worst yearly decline since 1981, after rising in each of the past 12 years.
In the last fortnight prices have dropped by nearly 15% – the steepest fall in 30 years – on persistent worries over the U.S. Federal Reserve's plan to wind down its monetary stimulus. Gold is used by investors as a hedging bet against rising inflation, but fears of a reduction in QE are damping concerns of higher prices because less central bank cash will ultimately flow into financial institutions.
MCX August gold futures may open today’s session near Rs 25700 levels with resistance near Rs 25800 levels.
Gold traders now looked ahead to Friday’s highly-anticipated U.S. nonfarm payrolls data for indications of how the recovery in the U.S. labor market is progressing. Any improvement in the U.S. economy could scale back expectations for further easing, putting upward pressure on U.S. yields and boosting the dollar.
Source by Commodity Insights