Gold Prices Dip as Investors Eye Jobs Data reports BuySellGoldIllinois.com

Some Say Gold May Rebound, However

San Francisco, CA (prHWY.com) November 9, 2012 - San Francisco, CA- Gold prices slipped on Thursday at the same time the dollar firmed, but investors were cautious, remaining focused on United States employment data before acting.

A spike in U.S. stocks after positive economic news offered some support to gold, while European shares were buoyed by a positive earnings report from Royal Dutch Shell.

Spot gold was down 0.3% at $1,713.89 an ounce.

Meanwhile, December's U.S. gold futures dropped 0.2%, or $3.60, to $1,715.50.

Early last month, gold prices climbed to nearly $1,800 per ounce after the Federal Reserve announced new economic stimulus measures, which are prone to boost gold prices by spurring fears of inflation.

Some investors turned to gold out of fears that the U.S. may face a "fiscal cliff" if Congress does nothing to stem tax hikes and public spending cuts due to occur at the beginning of the year.

"Before the elections on Tuesday, the non-farm payrolls will be quite a big deal," Natixis analyst Bernard Dahdah said. "(Further out), we have the fiscal cliff in the next two months. If you have more issues with that, that will definitely send the price of gold higher."

As the Fed's latest stimulus measures are mainly dependent on a strong U.S. labor market, non-farm payroll data will be under close scrutiny.

"The ongoing (stimulus) program Operation Twist will expire by the end of the year, thus forcing the Fed to decide whether to pump further liquidity into the economy or not at its December meeting," a representative of German global banking and financial services company Commerzbank wrote in a note.

"That means disappointing data is likely to cause speculation about an increase of QE3 towards year-end, thus putting pressure on (the dollar), while surprisingly positive results reduce this likelihood."

Technical analysis suggests spot gold may rebound slightly to $1,1736 per ounce, said Reuters market analyst Wang Tao.

According to global leader in precious metals trading, finance and distribution ScotiaMocatta, precious metal is challenging resistance at $1,721. "Support is at $1,693, the 38.2% retracement of the May-to-October uptrend, followed by $1,661, the 50% retracement level," it added in a note.

Traders in India were waiting on the sidelines for another price correction before buying.

"Gold prices ... may be helped by a pickup in Indian festive buying ahead of Diwali and the Indian wedding season," HSBC said in a note.

In the meantime, Russian gold companies increased gold production by 3.1% in the first three quarters of 2012 compared with the first three quarters of 2011.

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