Gold for April delivery was rising $4.10 at $1,413.10 an ounce at the Comex division of the New York Mercantile Exchange. The gold price has traded as high as $1,417 and as low as $1,407.90 during Monday's session. The spot gold price was up $3.10, according to Kitco's gold index.
Gold prices still have yet to conquer their 2011 intraday high of $1,418 an ounce and technical traders will be watching a break through at that level to determine if they want to put new money to work.
Open interest on the Comex on Friday was down 5,200 contracts but still "well over 500,000," says Georgeo Gero, senior vice president at RBC Capital Markets, which indicated long positions staying in the market."I think there is a high probability that we are going
In addition to being a safe haven investment for those looking for cover as political unrest in the Middle East continues, gold is also an inflation hedge. The Eurozone reported January inflation at 2.3%, higher than its mandate of 2%. The European Central Bank is meeting Thursday to discuss interest rates. The debate about whether to raise interest rates will no doubt take center stage at the meeting especially as oil prices rise, but aggressive action isn't expected and, if anything, it just draws more attention to the fact that inflation is heating up globally. Brazil's inflation rate is almost 6%, Russia's is at 10%, China almost 5%, U.K. almost 4% and even if central banks raise rates as Russia and China have done recently, it will take a lot of hikes to return to a positive interest rate environment. In the meantime, a weaker U.S. dollar should support higher gold prices in the midst of any profit taking. The U.S. dollar index was down 0.40% to $76.95.