Gold Fundamental Analysis Jan. 20, 2012, Forecast

Economic Events: (GMT)

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Analysis and Recommendations:

Gold is trading  today at 1649.95. down from a 5 week high of 1670.45

Gold continues to be a strong buy, adding on the dips.

Gold dropped in today’s session on economic data in from the US showed jobless claims dropped to the lowest level in almost four years, while consumer prices remained flat for a 2nd month. Housing starts data came in weaker than expected showing that the construction sector despite some improved confidence still has a way to go yet. Even though, market reports were saying there would be an increase in housing starts, until the foreclosure glut is absorbed housing starts will remain low.

Other positive signs for the US labor market was the drop in jobless claims falling by a larger than expected figure falling to 352K, the lowest since 2008. This follows a sharp increase in claims the previous week to above the 400K level.

Also rumors of the negotiated settlement in Greece along with statements from the IMF to start speaking with Greece about additional aid, as well as increased funding discussions to be held next month at the G20 meeting in Mexico

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