Gold prices zig zag to three-year highs

Australian gold prices have climbed back up to three-year highs, hitting $2673.56, according to data from ABC Bullion.

Prices last week slumped to a stagnant $2611.57 on May 9-10, rising minimally to $2618.50 on May 11 before taking off again on Thursday.

This is preceded by a price jump to $2671.62 on May 4 before progressively zig-zagging during the remainder of the week.

Gold producers Silverlake Resources and Saracen Mineral Holdings sat second and fifth, respectively, on Australian Stock Exchange’s top five gains on Friday (May 15).

Silverlake Resources’ share rose by $0.12, or 6.08 per cent, in value to $2.09, while Saracen gained $0.23, or 4.87 per cent, to $4.95 per share.

Comparatively, the United States gold price hit $US1732.53 ($2682.02) at the time of writing, continuing the attractive exchange rate for Australian gold producers.

DailyFX analyst Dimitri Zabelin said the roller coaster action of gold prices might suggest that gold might be heading towards the long-anticipated price slump.

“Digression aside, gold prices have managed to rise a little over 17 per cent from the December 2019-lows and was helped by a steep, upward-sloping support channel,” Zabelin said.

“However, recent price action suggests the precious metal may be losing steam as it trades within the range of the slope of appreciation.

“If it cracks under the weight of increased selling pressure, XAU/USD may encounter some downside friction between $US1671.81 and $US1671.84 before turning lower.”

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