Gold Prices Finds Support From Weakening U.S. Dollar

SPDR Gold Trust (ETF) (NYSEARCA:GLD) prices are set to test new highs as the U.S. dollar nosedives on account of Bank of Japan’s unforeseen move to keep policy rates unchanged.

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Hits 14-month highs

During the early European hours, the yellow metal had already breached 14-month highs with gold futures for June delivery trading at $1,278.85, up by 0.98%. As per technicals, the Futures are likely to find support around $1,238.50 levels and might test resistance at $1,303.50.

The demand for the safe-assets boosted after the BoJ maintained interest rates at the current level, unlike the wide expectations of stimulus boost. Moreover, the optimism in the gold also grew after the Federal Reserve’s held interest rates at current levels earlier this week. As per metals analysts, the commodity has found a bottom as the concerns around the U.S. monetary policy tightening continues to diminish.

Upbeat results

Among the miners, Eldorado Gold Corp (USA)(NYSE:EGO) recently announced the sale of its 82% stake in Jinfeng mine to a subsidiary of China National Gold Group. The deal will fetch the company $300 million in cash and is expected to conclude in the third quarter of 2016. The sale agreement reflects the company’s efforts to monetize from its Chinese assets.

Meanwhile, New Gold Inc. (USA) (NYSEMKT:NGD) posted upbeat results for its first-quarter. The company posted net income of $26.8 million in the first quarter, reviving from losses made during the same period a year ago. The company said that its net income came in at $0.05 per share while the revenues stood at $154.5 million, beating the Wall Street forecasts.

Barrick Gold Corporation (USA) (NYSE:ABX) also reported marked improvement in its earnings, which came widely higher than the market expectations. The company reported earnings of $0.11 per share, up from $0.05 per share a year earlier. Alongside this, the world’s biggest miner has also projected a decline in its all-in sustaining costs to $760 to $810 per ounce from earlier projections of $775-$825 per ounce.

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