The price of an ounce of gold slowed down yesterday as the dollar index showed an increase in the value of the US dollar. The dollar index measures US currency against other currencies from around the world. The DXY closed at 75.19 on Thursday.

This increase in the dollar index comes after it was announced that jobless claims are showing signs of leveling off as new data showed no change from the previous week.  Two weeks ago we saw jobless claims at its lowest point since January. This information paints a brighter picture of the future of the greenback as confidence in the US economy grows stronger.

Although gold has hit a speed bump this week it has still made impressive gains. On Monday, I predicted that gold would reach a high of $1,150 an ounce by this Friday. This was accomplished yesterday as gold hit $1151.20 an ounce before declining to eventually settle at $1140.70. So far this week we have seen incredible gains in the price of gold. Overall gold has risen 9% this month alone and an incredible 30% since the beginning of 2009.

Early this morning we saw gold prices increase, then sharply drop. The current price of gold is  $1133.99 USD down $6.71 from the closing price.

The dollar index and gold have an inverse relationship. As the dollar index moves up the price of gold is usually driven down. Because of this inverse relationship we are able to get an idea of which direction gold will head.

So far this week we saw gold reach $1150 an ounce before dropping off. The staff at Healthy Financial Habits believes that gold will not make any huge gains for the remainder of this week. We are expecting gold prices to settle around $1139 an ounce at by Friday’s closing.

Please visit Healthy Financial Habits for up to date information on gold and other commodities. Here you will find news and other information that will assist you in making informed investment decisions. Be sure to check back every Monday morning for weekly gold price predictions.

Author: John Zinsky