Gold Prices Move Sideways After BOJ Stimulus Action (Update 1)

Updated from 10:52 a.m. EDT with settlement prices

NEW YORK (TheStreet) -- Gold prices traded sideways Wednesday for the second consecutive session as investors waited on the sidelines for more news from the eurozone.

Gold for December delivery rose 50 cents to settle at $1,771.70 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,781.80 and as low as $1,764.20 an ounce, while the spot price was dipping $1, according to Kitco's gold index.

The gold price hit its highest level during the 24-hour period between daily settlements shortly after midnight on Wednesday following the Bank of Japan's announcement that it would expand its asset-purchase fund (more monetary stimulus) by $126 billion.

The yellow metal slowly shed gains from Japan's inflationary move as questions lingered over whether European leaders would be able to reach an agreement on a banking union.

Silver prices for December delivery settled down 13 cents to $34.59 an ounce, while the U.S. dollar index 0.11% to $79.10.

Gold jumped last week after the Federal Reserve implemented its latest round of asset-backed purchases -- so called QE3 -- which has left the precious metal in a sideways trade for most of the past few trading session.

"You're seeing easing in Europe, in Japan, but obviously the easing by the Fed is probably of most interest to us, because that's where they're fighting this deflationary focus," said Steve Billimack, a managing partner at HighTower.

Billimack said the recent strength of gold was being driven by weaker dollar potential and interest in real assets, and gold's price trend and momentum.

Though the immediate term may produce little action in gold prices, the open-ended stimulus package implemented by the Fed has led some gold investors to put 12-month price targets as high as $2,300 to $2,400 an ounce.

Chuck Butler, president of world markets at EverBank, pointed out in a Wednesday note that gold's 55-day moving average has come close to crossing with its 200-day moving average -- an event he said could generate a mass of technical buying.

Gold mining stocks were mixed Wednesday. Shares of AngloGold Ashanti (AU) were dipping 0.90%, while NovaGold Resources (NG) was gaining 5.5%.

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