Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— With U.S. markets closed for the Martin Luther King holiday, gold slipped 0.4% to $1,274 in London trade as investors took profits from last week's rise of nearly 5%.

Following the Swiss National Bank's shocking decision on Thursday to dump its currency's peg to the euro, gold reached a four-month high last week on demand for the metal as a haven from rising volatility in currency and equities markets.

Support for higher prices remains high, however, with events pending this week that could have major ramifications for the Eurozone. The ECB is expected to announce Fed-style quantitative easing at the end of its policy meeting on Thursday. Tantamount to printing money, QE will further erode the value of the euro and build demand for alternative stores of value.

On Sunday, Greece will hold a general election that may decide whether it remains in the Eurozone. If the anti-austerity Syriza party gains power, as polls indicate it will, Greece may renege on the terms of its agreement with the ECB, resulting in its likely departure from the common currency. Such a market disruption could drive gold substantially higher.

The other precious metals were mixed on the day. Silver dropped 0.3% to $17.68 while platinum was unchanged at $1,263.25 and palladium gained 0.4% to $754.22.