Gold At Week's End

Precious-Gold showed a slight decline on Friday after recording its highest one-day rise in more than three months, Thursday, amid escalating tensions from the euro area.

In the previous session, the yellow metal managed to advance more than 2% -- following four-and-a-half-month lows -- as investors move back in on hopes of a rebound.   

Correction
Indeed, the shiny metal did an upside correction as momentum indicators signaled it was oversold.

However, mounting worries from the euro area are expected to put the shiny metal under pressure to record the third consecutive weekly drop this week.  

Banking Downgrades
Yesterday, Greece had its long-term credit rating cut by one notch to CCC from B- by Fitch Ratings on the back of the political turmoil that threatens the country's stay in the euro bloc and commitment to financial obligations.  
In six weeks, another election will take place and left-wing, anti-austerity parties are betting they will win the race.   

In Spain, worries intensified after Moody`s Investors Service cut Banco Santander, Spain's biggest lender, and BBVA credit rating by three levels on loan losses and anemic economic conditions.  

Data released yesterday showed that Spain suffered a technical recession as the final GDP reading showed 0.3% contraction in the quarter through March, following the 0.3% shrink in the last quarter of 2011, while borrowing cost rose at auction.  

Still, the yellow metal is tracking losses and gains in the euro which is currently trading around its four-month low.

The U.S.D advanced against a basket of major currencies continuing its rally for the ninth straight session, where the dollar index is currently hovering around 81.66 compared to the day's opening of 81.47.

Crude oil for June delivery is currently trading lower around $92.03 a barrel from the day's opening of $92.63.

Hence, gold is facing downside pressure from the strengthening dollar and the falling price of oil.