Gold hit 2-month highs on Thursday as investors sought a safe haven as the dollar slid against the basket of currencies on worries that U. S. deficit might be widening and economic recovery would be painfully slow and triggered an upside in gold prices.

Silver also rose sharply by $200, riding with the rise in Gold, ending the day at $22467 on COMEX.

The world's largest gold-backed exchangetraded fund, the SPDR Gold Trust, said holdings stood at 1,105.62 tonnes as of May 21, unchanged from the previous business day.

The dollar plummeted to its lowest level this year against a currency basket as fear of widening U. S. deficits soured the outlook for dollar-based assets. FUNDAMENTAL

We expect precious metals to trade up during the day on account of weak economic outlook released by FED. The rise in rupee against the dollar may add some downward pressure in Gold but we recommend buying at dips during the day.

Gold prices have moved upwards in the past few sessions. The RSI is giving cross over on upside in Gold, thus Gold looks positive for the day above 14425 levels. Gold can move upwards to 14525 levels if it maintains 14425 levels. Gold can even surpass 14525 levels and attain 14600 levels if currency movement favours.

Silver Prices showed a very strong signal yesterday by pulling-back prices upside during the close. Silver Prices can move up to 22750-800 levels, if it breaches 22500 levels during the day. Thus, one should buy silver at dips during the day around 22200 levels, or only above 22500 levels for higher levels.