Thursday's market opening gave gold a chance to gain back some of its Wednesday losses, with a weakening US dollar enticing investors to pick up some bargains. The yellow metal bounced back after dropping nearly 2 percent midweek, its biggest one-day fall since February 20. Factors weighing down gold this week include a price forecast slash by Goldman Sachs (NYSE:GS), the Federal Reserve's indecision on ending its bond-buying program and rumors that Cyprus plans to sell its gold reserves.
Commenting on gold's slight rebound, Kitco's Jim Wyckoff said, "[y]esterday's price action confirmed that the bears are in near-term technical command. When you see a big price move in a market, many times the following day you'll see a pause just as traders catch their breath."
Overall, however, investors can expect gold's bounce to be short-lived. “We believe a sharp rebound in gold prices is unlikely, ” Goldman Sachs stated.
VTB Capital analyst Andrey Kryuchenkov also weighed in on gold prices, noting that he expects the yellow metal to stay above $1,550 for the time being — unless it can breach the resistance point of $1,584.60.
For the moment, gold is up. It ended Thursday's session at $1,564 per ounce.Cyprus won't be selling gold reserves Rumors that Cyprus will be selling 400 million euros ($522 million) worth of its gold reserves as part of a financial-rescue plan weighed heavy on the yellow metal this week. Though the Central Bank of Cyprus denied the rumors, the speculation worried market watchers. The fear is not about the amount of gold to be sold, Matthew Turner, an analyst at Macquarie, explained. Instead, the concern lies in the fact that Cyprus would be "the first euro zone country to have said it will do this for a while." That raises concerns that other Eurozone members might also consider selling central bank gold reserves as part of their bailouts.