Gold Prices React to U.S. PPI Report

On Tuesday, Gold prices continued to trend higher after breaking since Friday. Despite the USD’s holding steady, the decline in U.S. treasury yields buoyed the precious metal.

The solid U.S. PPI report released on Tuesday by the Labor Department showed that part of wholesale inflation is decelerating.

Heavy buying trend of U.S. treasury yields, given the Fed’s stance that rate will remain unchanged while quantitative easing is unwound, will continue to act as supporter for gold prices.

Support is seen near the breakout level which is the September highs at 1813. Target resistance is seen near the June highs at 1916.

The 10-day moving average has crossed above the 50-day moving average which means a short-term up trend is now in place.