Gold rose to a five-week high on Monday as markets reassessed the outlook for the U.S. economy after Donald Trump is inaugurated as president later this month, taking support from the falling dollar and lower U.S. Treasury yields. The metal posted its biggest weekly increase in two months last week. Strong outflows from gold-backed exchange-traded funds have also lessened of late, while seasonal buying in the big Asian gold markets, where India is deep into wedding season and China is approaching the Lunar New Year, has been strong. A tiny dip in the dollar and weaker equities are enough to support gold, which is starting to benefit from greater stability in emerging markets. Boston Federal Reserve President Eric Rosengren called for the U.S. central bank to step up its pace of interest rate increases, while Atlanta Fed President Dennis Lockhart said the possibility of a fiscal boost under Trump has shifted economic risks to the upside. These elements will continue to provide a floor to gold prices. But Fed’s interest rate hike is expected to keep bullion under pressure in the medium and longer term.
On technical front, gold crossed through previous resistance of $1,168 an ounce and kept rangebound above the mark. The daily MACD points to a bullish tone, suggesting retaining upside momentum. Gold is expected to move up in coming sessions with the next resistance at the 50-day moving average of $1,193.
Silver continued its upward momentum, up 0.8 percent at $16.61 an ounce. Technically, silver sees further upward momentum. We believe that the metal is likely to test the resistance of the 50-day moving average of $16.81 in near term. Overall, it would track gold’s movement.
 

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