Gold rose to its highest price in one month on Thursday as the dollar slipped further below a 14-year peak hit earlier this week and minutes from the central bank's December meeting showed uncertainty about economic policy changes. Spot gold rose to its highest since Dec. 5 at $1,184 an ounce and was up 1.5 percent at $1,180. Although U.S. growth is improving, there shouldn't be any further significant appreciation in the dollar after the strong run of the past few months, supportive for dollar-denominated gold. Data showed U.S. private employers added 153,000 jobs in December, below economists' expectations. The dollar is expected to extend losses against a basket of six major currencies in the event of a disappointing nonfarm payroll report due on Friday. Also support to gold is that the dollar usually goes weak in the first quarter due to a lackluster economy out of bad weather.
On technical front, gold welcomes clear signal for reverse as the MACD shrank sharply below the axis zero, and the express and slow line turned upward. The 50-week moving average of $1,201 converged with the downward path at the key mark of $1,200. Bullion is expected to rise further to hit the aforementioned resistances.
Silver was up 0.85 percent at $16.56 ,crossing above the key resistance of $16.6. Technically, silver sees further upward momentum and is quite likely to breach the 50-day moving average. The movement between $16.80 and $17 will determine its performance in the first quarter. Tracking gold, the white metal is expected to see a round of rally as the dollar pulls back.

 
Dealing Room, ICBC Beijing Branch
Lv Yan

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