The yellow metal has boomed from the lows seen in the last six months to level beyond US$ 2000, and currently it is perched at 2010 level. The boom was possible with the depreciation of the US Dollar against other currencies, and the fall in the Dollar Index, both of which were possible due to the market’s perception that the US interest rates and more specifically the US official rate policy could turn soft very soon. US rates are so important for gold movements because gold was not able to make any headway due to the rate hikes in the US occasioned by persistent inflation, and this pushed up the US currency yields as also the money market yields. The rise in US rates was the factor that prevented any upside for gold or rather limited it for almost one year now despite the high global inflation. With inflation gradually moving down and the US rates reaching somewhere near the peaks, there is likely to be an upward buoyancy in gold prices. Technically, there is good support at 1980 and then at 1930. The first resistance is at 2035, and it could test 2060, and 2090 in that order.
