By Zhang Mengying
Investing.com – Gold was up on Thursday morning in Asia as the U.S. dollar paused for breath after surging to 20-year highs.
Gold futures were up 0.36% to $1,742.80 by 12:34 AM ET (4:34 AM GMT). The dollar, which normally moves inversely to gold, edged up on Wednesday morning.
“With momentum pointing south, dip buyers are effectively trying to catch a falling knife,” said Matt Simpson, senior market analyst at City Index.
“$1,721 and $1,700 are potential levels of support for bulls to consider taking a punt.. but until the dollar tops, it likely is a punt.”
During the previous session, a strengthening dollar pushed bullion down as much as 1.9% to its lowest level since Sept. 30 at $1,731.00.
“This decline has room to continue,” DailyFX currency strategist Ilya Spivak told Reuters, adding that if gold falls through support at $1,715 per ounce, it could head under the $1,700 figure to the vicinity of about $1,680.
The minutes released on Wednesday from the U.S. Federal Reserve’s June meeting suggested the possibility of an “even more restrictive” monetary policy to prevent long-lasting inflation. Now investors have priced in another 75-basis point interest rate hike in July from the Fed.
In other precious metals, silver was up 0.70%. Platinum jumped 0.72%, while palladium gained 0.57%.