Gold jumps to Rs114,000 per 10grams as dollar weakens

ISLAMABAD, April 29: Spot gold prices recovered for the second straight day amid a weaker US dollar on Friday; however, firm US treasury bond yields limited the gains.

As of 1315 hours GMT, gold in the international market was available at $1,910.80 per ounce, gaining $16.60 (+0.88 percent). Out of the $16.60 per ounce increase, +$8.30 was due to weakening of the US dollar and +$8.30 was due to predominant buyers, according to Kitco Gold Index.

The price of 10 grams of 24carat yellow metal in Pakistan, meanwhile, increased to

Rs114,000 after gaining Rs1,500. Gold price in the local market settled at Rs112,500 on Thursday last.

Month-end flows combined with profit-taking have triggered a sharp correction in the US dollar against its major rivals, aiding gold price to recover sizeable ground above the $1,900 mark. The rebound in gold price, however, appears shallow, as the dollar will continue capitalising on the aggressive Federal Reserve rate hike expectations.

Gold lost its traction and started to pull away from the daily high it set at $1,920. The benchmark 10-year US Treasury bond yield went up more than 2 percent on the day, making it difficult for gold to preserve its bullish momentum. From a technical perspective, gold faces stiff resistance near $1,918 on the road to recovery. Next resistance lies at $1,927, which is the previous week's low. On the flip side, if the recovery momentum fizzles out then the support awaits around $1,905, where a dense cluster of support levels comprising the pivot point one-week S1, SMA5 one-day and pivot point one-day R1 converge. - DNA