Spot Gold highest since July

Spot gold is trading at its highest since July last year amid further banking concerns that sparked investors to swap euro for gold. East European banks were at risk of default, considering the rapid economic decline in that region.

Momentum is going to push gold prices higher with financial market uncertainty driving investors to the precious metal, bearish sentiment in the market over equities, financial market uncertainty "back in play" was likely to mean more buying into gold.

Gold got an additional boost higher after Russia's central bank confirmed it had been buying gold, with gold's share in its reserves growing by about $1 billion to $15.5 billion during January, This combination has triggered another move in gold, taking the metal to the highs for the year and seems set to make further gains.




Technically gold is expected to trade higher after it traded above $936.3/oz last week, the next significant target higher is at $989.6/oz and then $1,000/oz and then $1,033.9/oz, Options were bought in Asia for gold at $1,000/oz and $1,050/oz, which indicates the momentum and expectation is for gold to move higher.