Gold on the way for a 3^rd day of gains (Reuters) (19-01-2011)

SINGAPORE – Spot gold was ready for a third consecutive day of gains on Wednesday, as dollar stayed weak and physical buying low, while platinum hit a 30-month high, buoyed by an improved economic outlook.

Spot gold rose by half a percent to $1,374.30 an ounce by 0715 GMT, gearing for its third straight day of gains and U.S. gold futures gained 0.4 percent to $1,374.2.

According to a Reuter’s analysis, spot gold is expected to end its current minor rebound by briefly touching a trendline resistance at $1,378 per ounce, as the major trend is still down.

Market sentiment remains buoyed by active buying in Asia, making gold possible to trade in the range between $1,370 and $1,378 with a possibility of breaching the upside.

Spot platinum rose to $1,844 an ounce, its highest since July 2008, before easing to $1,840.74.

Platinum is expected to surge to $1,950 per ounce over the next few weeks, should it stand firm above a pivotal resistance at $1,850, as the uptrend is steady and the bullish momentum has not dissipated.

Upbeat economic data from the U.S. and Europe in recent weeks suggests the global economy has gained a steadier footing, boding well for industrial metals as well as precious metals with industrial uses, including silver, platinum and palladium.

Source: Reuters