Gold retreating after a long standing rally

The last three weeks saw Gold rushing forward touching the high of $1,140, due to economic uncertainty and demand for a hedging instrument. Today, the yellow metal has retreated slightly to below $1,130. Another factor contributing to the decline of the precious metal has been the charging US dollar, which today saw a further strengthening on expectations of economic recovery in the US.

In the Asian and early European sessions, the Dollar moved upward against all major currencies, particularly against the Yen, which has seen a slight weakening in recent times. It is currently said to be testing a major resistance at the 93 level, having moved beyond 91.25 and 92.75.

Analysts are now suggesting that the USD/JPY pair is likely to see a strong 2010, with the possibility of 100.00 not too far away, 3rd quarter likely as suggested. It is further suggested that 97 could be the level to watch out for for Q2 2010.