Yellow metal may extend rally beyond $1,030

The gold rally between the levels of $990 and $1,020 an ounce may finally end with the bullion crossing the all-time high price of $1,030.80 an ounce, dealers of precious metals say.

Gold is currently downward bound and stood at $992.20 an ounce when it last traded. Analysts say the bullion may drop to a support level of $980 an ounce before resuming an upward journey.

"I don't think it will drop below $980 an ounce. The Indian festival season is providing it a strong support," said Jeffrey Rhodes, CEO of Dubai-based INTL Commodities DMCC.

Positive sentiment emerging from the just concluded G20 meeting may be the other reason that would eventually help gold cross the psychological barrier of $1,030 an ounce when it embarks on an upward journey again.

Gold extended its recovery from last Monday's brief dip below $1,000 to reach $1,020 on Tuesday, as weakness in the green back drove commodity prices higher across the board. Gold traded at $1,015 an ounce on Wednesday having dropped 0.02 per cent from previous day's trade. It dipped below $1,000 an ounce later in the week.

"Dealers in global markets are focused on the Fed interest rate decision and the G20 meeting on Thursday and Friday for signals on the global economy," said Rhodes. 

 

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