MTECHTIPS;-Gold gains 1% ahead of Italy vote results;Bernanke testimony eyed
Gold futures were up sharply during U.S. morning trade on Monday, moving
further off last week’s
seven-month low as the U.S. dollar came under pressureamid optimism that economic reforms in Italy would not be derailed by electionresults.On the Comex division of the New York Mercantile Exchange, goldfutures for April delivery traded at USD1,588.80 a troy ounce during U.S.morning trade, up 1% on the day.Prices rose by as much as 1.3% earlier in thesession to hit a daily high of USD1,593.80 a troy ounce. Gold futures fell to aseven-month low of USD1,554.80 a troy ounce on February 21.Gold prices were likely to find support at USD1,554.80 a troy ounce, the lowfrom February 21 and resistance at USD1,609.00, the high from February20.Market sentiment was buoyed by hopes that a pro-reform governmentwould emerge following general elections. Meanwhile, speculation over a lowvoter turnout in northern Italy help ease concerns over a strong electionperformance by former Prime Minister Silvio Berlusconi. Exit polls were due tobe published after voting closed at 3pm local time, with final results expectedTuesday.The news prompted investors to move in to riskier assets such as theeuro and industrial commodities and shun safe-haven assets like the U.S. dollarand Treasuries.The dollar index, which tracks the performance of the greenback against abasket of six other major currencies, was down 0.35% to trade at 81.27.