Gold slipped from a five-week high and silver traded below its 11-month peak on Friday as the dollar strengthened against the euro, but the metals were headed for weekly gains buoyed by a rally commodities.
Spot gold XAU= eased 0.2 percent to $1,246.20 an ounce by 0042 GMT. Gold hit a five-week high of $1,270.10 on Thursday, but pared some gains after the dollar regained ground versus the euro.
For the week gold has gained 1 percent, largely on the back of silver's near-5-percent rally this week.
Spot silver XAG= hit an 11-month peak of $17.695 on Thursday although it also later pared gains on dollar strength.
Silver's rally has been spurred by a break above key chart resistance and optimism over China, where recent data has showed new debt fuelling a recovery in factory activity, investment and household spending.
Other metals used in manufacturing have also risen on hopes of Chinese demand. Copper jumped to a four-week high, while steel soared to a 19-month top on Thursday.
Gold and silver prices backed well off their daily highs Thursday, on profit-taking pressure from recent gains. Earlier in the day gold hit a five-week high and silver notched an 11-month high. The key "outside markets" in morning trading also turned negative for the precious metals markets, as the U.S. dollar index rebounded well up from its daily low and Nymex crude oil futures prices moved lower. June gold futures were last down $3.40 an ounce at $1,251.00. May silver futures were last down $0.06 at $17.075.
Technically, June gold futures prices closed nearer the session low today. The gold bulls still have the firm overall near-term technical advantage. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the March high of $1,287.80. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at last week’s low of 1,225.40. First resistance is seen at $1,264.70 and then at today’s high of $1,272.40. First support is seen at today’s low of $1,244.40 and then at $1,240.00. Wyckoff’s Market Rating: 6.5
Reference: Reuters, Kitco
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