Gold Forecast Dec. 06, 2011, Fundamental Analysis

Gold prices fell on Monday following the biggest weekly rally in more than a month, where investors were cautious ahead of the ECB meeting and the EU summit, as even the weakened U.S. dollar couldn’t help push gold prices higher.

Traders will continue to monitor the developments from Europe regarding the debt crisis, where reports suggest that Germany and France reached an agreement on a plan to ease the European debt crisis. Nonetheless, tensions remain elevated in financial markets, as investors are concerned that EU leaders will fail to reach an agreement again after suffering similar disappointments over the past few months.

Accordingly, we should expect more fluctuations in prices, especially amid the lack of economic fundamentals from the United States throughout this week, and the main focus accordingly will be the developments in Europe and whether EU leaders can craft a plan to resolve the worsening debt crisis.

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