Gold traded in a very narrow range last week and support at 2000.00 has been holding. We believe the gold price is about to begin a rally back towards 2100.00 but not before a pullback to the 1950.00 to 1970.00 area. This pull back should begin within a few weeks and could start with some key economic indicators on inflation coming out this week. The U.S. equity markets continue making new highs and while this continues gold will drift lower. If the interest rates remain high at over 5% there is no rush to invest in gold. Most talk of cuts in interest rates have been pushed out to May and even further. Without lower rates it is unlikely gold will begin its rally to the next higher level. Our expected range on the gold price remains 1960.00 to 2060.00 for the near term.
Gold had a strong beginning to week until a surprise surge in the monthly jobs report on Friday took the yellow metal lower closing at 2039 area. We see the support level for gold at 2000.00 being tested again with the possibility of breaking below this level and gold testing the 1950.00 to 1925.00 area at the lower end of our range. We still expect the range for the next few weeks to be from 1950.00 on the bottom to 2065.00 on the top.