Gold price continues to consolidate near the highs

London (Jan 15)  The gains came in an environment of risk aversion but even as that's reversed, gold has held on. That's a positive sign and if/when risk trades turn lower again, it could boost gold.

On the flipside, the US dollar has been weakening since the start of the year (it's the weakest G10 currency this year) and even with the dollar under pressure, gold isn't responding.

Ultimately, the technicals will tell the story. If gold can bust out over $1300 then I think it can continue to run. The lunar new year is February 5 and that should be a tailwind. That said, there are deep concerns about a slowdown there and gift-buying for gold could stumble.

ForexLive