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Gold Ticks Up In Morning Trade As Shutdown Fears Boost Haven Appeal

ByICN.com
Published 10/07/2013, 05:20 AM
Updated 07/09/2023, 06:31 AM

Gold moved higher Monday morning as concerns over the U.S. government paralysis kept prices ticking up above $1,300 an ounce.

The precious metals market is still pricing in fears that Congress may struggle to overcome shutdown and raise the debt ceiling before the 17 October deadline, when the U.S. government runs out of expedites to avoid a formal default on its debt. Meanwhile, gold remains the safest of them all!

Spot Gold was up 0.3% at $1,314.50 an ounce as of 06:43 a.m. GMT today.

The federal paralysis has been going for almost a week now and Washington`s ultimate nightmare might become reality if both Democrats and Republicans held their irreconcilable positions. The debt clock is ticking louder overnight, and even short-lived default would be utterly catastrophic.

Republican House Speaker John Boehner was extremely disappointed, adding that his nation is still on the path to default.

"The nation's credit is at risk because of the administration`s refusal to sit down and have a conversation," he said on Sunday.

So far the economic front is shy of any fresh releases with the ongoing shutdown and gold prices are is still trading in the low range of $1,300 an ounce for the third straight day now, thus any negative updates from the Congress will surely see prices test $1,400 levels one more time.

Technically, Gold is consolidating back above $1305 support level, while below the main descending resistance for the latest bearish wave.

The trend remains sideways accordingly, unless prices break below $1,305 to $1,273 key horizontal support, a break below which will signal the resumption of the overall bearish trend.

On the other side, breaking the descending resistance would call for another leg higher.

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