Friday, June 26, 2009

Today in Gold: Friday, June 26

Each weekday, Cash4Gold will troll through the web's gold banter and post some of the bigger or more interesting stories. Following is a run-down of today's features:

"Gold rises slightly as dollar broadly drops"
Author: Frank Tang

Main Points: Gold finished the week relatively strong, ending up $1.50 today to close at $941 an ounce.

While gold has benefited largely from the weakening of the dollar, a strengthening economy and lessening inflationary fears have held it back.

"One of the reasons gold has been bought has been as an insurance premium against inflation, or against systemic risk from another camp of investors," said Peter Fertig of Quantitative Commodity Research. "At least for the latter group, their need to hold gold has clearly been reduced."

Analysis: Although this was the fourth consecutive day moving in an upward direction and the week was strong overall, gold still appears to be range bound. To regain its strength it needs something -- inflation, new poor economic data -- to support it. Otherwise, investors will continue to feel safe investing in riskier stocks and have little need for gold.

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