Gold retreated 0.3 percent on Thursday after the dollar rebounded. The euro dropped and the dollar index against a basket of six major currencies rebounded back above 101 as the European Central Bank decided to cut its asset buying to 60 billion euros a month from next April from 80 billion euros now, and extend monthly asset purchases six months longer until next December. Gold will be kept under pressure on strengthened expectations of an interest rates hike by the Federal Reserve. On technical front, the momentum index and the MACD index still pointed to a bearish tone. The level of $1,180 constitutes an effective resistance, but the downward potentials were also limited with support at recent lows of $1,157.
Silver tracked gold’s falling trajectory with support at $17. The chart shows a more optimistic tone. But investors are recommended to stay on the sidelines amid overall headwinds for precious metals.
 

Dealing Room, ICBC Beijing Branch
Yang Hui

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