Gold for February delivery added $23.40 to settle at $1,631.50 an ounce at the Comex division of the New York Mercantile Exchange. The gold price has traded as high as $1,641.40 and as low as $1,609.20 an ounce while the spot price was up $22, according to Kitco's gold index.
Gold prices gained steam as investors bought back previously sold positions and as momentum traders jumped in after gold broke above its 200-day moving average, its most watched technical level.
Gold closed just shy of the level most traders were watching -- $1,632 to $1,635 an ounce. "We do need to close above $1,635 to really cement being in the midst of this range," says Stan Dash, vice president of applied technical analysis at TradeStation. Dash notes that a lot of the rally in gold happened overnight, triggering short covering in the U.S. markets. "We haven't really moved that much since the U.S. trading banking day began. We've been steady." Dash thinks this is a signal to be cautious. David Banister, chief investment strategist at TheMarketTrendForecast.com says that $1,625 was the first hurdle for gold, but now it must conquer $1,675. "
-- Written by Alix Steel in New York.
>To contact the writer of this article, click here: Alix Steel.
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