Gold Daily Fundamental Analysis for August 25, 2011

By CommoditiesMansion.com

Gold prices fell on Wednesday for a second day after rising to a new record high above $1900 an ounce set on Monday, where rising optimism among traders boosted demand for higher yielding assets, which pushed prices off their record high. U.S. durable goods orders rose above expectations, which eased concerns among traders over the outlook for economic growth in the United States, and increased demand for riskier assets.

We expect demand for safe haven to remain strong over the coming period, since traders will continue to focus their attention on the European debt crisis and the slowing economic activities in the United States. Moreover, traders will be eyeing a key speech by the Fed's Chairman Ben Bernanke on Friday, where Bernanke could signal more monetary easing, and that could boost demand for gold prices, while the current drop in gold prices is not likely to continue, since it seems to be a correctional wave, as investors are closing their positions ahead of Bernanke's speech on Friday.

Originally posted here