GOLD

FUNDAMENTALS

Gold climbed to 28 years high on Monday on renewed concerns of credit market turmoil. Slight recovery in dollar and decline in crude oil prices however contained the gains.  COMEX December Gold closed the session at record high levels of $810.80 an ounce with a gain of $2.30 an ounce. The contract saw the highs of $813.80 an ounce during the session.  

Credit market concerns raised after Citigroup said it will write off another $8 billion to $11 billion to reflect the declining value of subprime mortgage-related securities since Sept. 30.

India's gold sales during the forthcoming period of peak festival demand are expected to rise by 10-15% from a year ago due to the bullish trend in the metal, according to the World Gold Council. India's gold consumption during October to December 2006 was 207.7 tonnes.

The net long positions of funds in Comex gold inched higher to 220,901 against 209,869 in the previous week according to CFTC data..

Turkish gold bullion imports rose to 13.9 metric tons in October from 11.5 tons in the corresponding month last year, according to Istanbul Gold Exchange data. In the first 10 months of the year gold imports to Turkey rose to 205.771 tons from 165.745 tons in the corresponding period in 2006.

TECHNICALS

The prices continue to hold the levels above short term and medium term EMAs, which supports bulls. MACD is rising in positive region showing increasing bullish momentum in the market. However, overbought levels of stochastic and RSI warrant caution to bulls.

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