The Gold Price hit a high of $1795 per ounce Wednesday morning in London – 1.1% off last Wednesday's all-time high – before selling off towards lunchtime.
Broad commodities rose while stock markets fell following Tuesday's Franco-German summit in Paris.
"Downside support [for the Gold Price ] is found at $1742," say technical analysts at bullion bank Scotia Mocatta.
"Our big picture view is that while $1687 holds, the risk is for a measured move objective of $1932."
Silver Prices broke the $40 per ounce mark around lunchtime, hitting $40.38 – a 3.4% gain for the week so far.
"Gold is still the most appealing asset in the short run, while uncertainty over the Eurozone's future will not evaporate overnight," says VTB Capital analyst Andrey Kryuchenkov.
Eurozone governments will not start issuing so-called Eurobonds – join-government debt instruments collectively back by all members of the single currency. Nor will the European Financial Stability Facility – the Eurozone's €440 billion bailout fund – be enlarged.
Those were the conclusions of Tuesday's meeting between French president Nicolas Sarkozy and German Chancellor Angela Merkel.
"Eurobonds can be imagined one day," Sarkozy told reporters after the meeting.
"But at the end of the European integration process, not at the beginning."
Merkel described Eurobonds as "last resort" that are not required at this point.
The two leaders instead advocated closer integration of Eurozone members' fiscal policies – with sanctions for those that breached rules on deficits and debt limits – and proposed an 'economic government' for the single currency area headed by current European Union president Herman van Rompuy.
In a joint letter to Van Rompuy Wednesday morning, Merkel and Sarkozy suggested a freeze on EU structural funding – intended to grant financial assistance and resolve economic and social problems – for members who fail to comply with Brussels recommendations on deficit reduction.
Currently 14 of the 17 Eurozone countries – including France and Germany – are subject to the European Commission's "excessive deficit procedure". EDP is triggered when a deficit exceeds 3% of gross domestic product, or when total government debt breaches 60% of GDP.
Merkel and Sarkozy also proposed a levy on financial transactions – known as a Tobin tax.
"Again, European leaders fail to provide a proper answer to the right question," says a note from French investment bank Natixis.
"A European Tobin-like tax is not the solution."
"The market felt [the meeting] to be useless [which] brought gold higher," said Swiss Gold Bullion refiner MKS on Tuesday.
Since the first Greek bailout in May 2010, the Euro Gold Price – which hit a high of €1248 per ounce this morning – is up more than 30%.
On the currency markets, the Swiss Franc shot up 2.6% against the Euro on Wednesday morning, prompting the Swiss National Bank to repeat its assertion that the Franc is "massively overvalued".
The SNB announced that it is expanding liquidity supply for the second time in a week. The central bank aims to increase banks' instant access deposits with the SNB by 67% to SFr200 billion.
"The SNB reiterates that it will, if necessary, take further measures against the strength of the Swiss Franc," said an official press release.
The currency's rise this morning saw the Swiss Franc Gold Price fall 2.3% to SFr1400 per ounce.
The Bank of England meantime refrained from expanding its asset purchase program – known as quantitative easing – at its nine-member Monetary Policy Committee meeting earlier this month, with only one of the nine members voting for expansion, minutes published Wednesday reveal.
Other members, however, "considered whether there was a case for increasing the degree of monetary stimulus by undertaking a further programme of asset purchases. Those members concluded that the case was not yet strong enough... further asset purchases might nonetheless become warranted were some of the downside risks to materialise."
The MPC voted unanimously to keep rates on hold at 0.5% – where they have remained since March 2009. At every other MPC meeting this year, at least two members have voted for a rate hike.
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