Gold rises as investors unwind bearish positions
Tension between Saudi Arabia and western nations and potential divisions in Europe are also helping bullion
Bengaluru — Gold rose on Tuesday as investors unwound some bearish positions after prices jumped to a two-and-a-half-month high in the previous session, driven by a global equities sell-off. Spot gold was up 0.2% at $1,229.34/oz by 11.09am GMT, having peaked on Monday at $1,233.26, its highest since July 26. US gold futures were up 0.2% at $1,232.70. “Gold is still holding the gains, very close to the 100-day moving average. A close above that level could be a positive sign and provoke more short-covering and push prices higher,” said Commerzbank analyst Carsten Fritsch. Speculators who trade on technical signals regard a break above the 100-day moving average as a bullish sign. Data last week showed that speculators had increased their short positions and traders said the recent rally forced many to abandon those bets on lower prices. Tension between Saudi Arabia and western nations, plus potential divisions in Europe over Italy's budget, was also helping gold, Fritsch said.
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