Tag Archives: gold trading

Jan 28

Price of Gold Weekly Recap – January 21-25, 2013

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Monday Open: $1,690.00
Weekly High: $1,695.40
Weekly Low: $1,657.40
Friday Close: $1,659.20

Though lacking significant external selling pressures this week, gold nonetheless took a $30 loss to break the upward trend that was characteristic of the beginning of the year. The price drop can be generally attributed to global economic improvements that are projected to continue throughout 2013, lessening interest in gold as a safe haven.

Monday opened slow and steady as trading was quiet for the Martin Luther King, Jr. holiday. Tuesday was also fairly steady, despite bullish news for gold from Japan. The Bank of Japan announced a quantitative easing program that would raise its inflation aim from 1% to 2%. Amidst this news, the U.S. dollar fell against the yen by 1.2%, but this didn’t make much impact on gold.

Wednesday’s global economic reports caused a drop in gold. The European Union reported positive growth for January, and a Reuters poll projects overall world economic growth based on a recovering Asian economy. With major industrialized countries showing economic recovery, gold hasn’t necessarily lost its sheen, but it may be downplayed as a safe haven investment in the coming weeks. Citibank downgraded its projection for gold on Monday by 4.2% to $1,653 per ounce for 2014.

Thursday dropped gold back to a mid-December trading range, 13% below the highest the yellow metal ever reached in 2011 – $1,923 per ounce. Thursday’s decline may just be a continuation of the previous days positive global economic growth reports. Friday continued to descend to end the week with a two-week low.

However, all expectations for gold are not lost; they seem to just be paused.  While most analysts expect to see slow movement for gold in the next few weeks, ScotiaMocatta, a global trading company, highlights the big picture by saying in a report, “The financial system is drowning in debt and there seems no end in sight to ongoing massive budget deficits.  Confidence in the financial system and in the fiat government paper that facilitates it will remain low.” Next week, the FOMC will meet again, but no monetary policy change is expected.

Jan 21

Price of Gold Weekly Recap – January 14-18, 2013

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Monday Open: $1,667.80
Weekly High: $1,694.10
Weekly Low: $1,667.80
Friday Close: $1,684.30

It was a good week for gold. After continued hums in the marketplace questioning gold’s volatility, January is proving to be a bull month for this yellow metal. Gold gained 1.6% this week, its highest move since November 2012. This follows last week’s 0.3% gain, which ended a six-week long losing spree. Speculation still abounds about gold’s true winning capacity, but so far, the market is showing slow but steady gains.

Monday opened with the low of the week and shot steadily upwards through Tuesday. On Tuesday morning, news broke that platinum was trading higher than gold, a rare phenomenon that last occurred March 2012. Platinum hit $1,702 while gold stayed around $1,682. Platinum rose largely due to the halting of some major mines, increasing desire for the metal. Gold responded little on Tuesday, but as platinum hit its seventh bullish day on Wednesday, gold did take a little drop.

Thursday’s drastic price fall can be attributed to the U.S. weekly jobless claims report, which was significantly better than expected. However, gold quickly rebounded a little while later in the day after U.S. manufacturing data revealed unexpected contraction.

Though the fiscal cliff crisis has passed, Credit Suisse analyst Tom Kendall pinpoints the U.S. debt ceiling as a major factor for gold. He assesses the situation as being positive for gold, since the U.S. faces downgrades from credit agencies, and thus a stronger investment in hedge funds. It will also get people thinking about the long-term value of the dollar, which will most likely turn out to be bullish for gold. The debt ceiling debate is on the horizon for the end of February.

Friday consolidated the week’s gains to end on a high note. Amid the trading activity this week, a few major investment companies added further speculative projections for gold in 2013. The projections vary drastically, as Goldman Sachs downgraded its 2013 gold prediction to $1,200, while successful gold producer Iamgold upgraded its projections to $2,500. Falling smack dab in the middle, metals consultancy firm GFMS predicted a bullish year for gold, anticipating $1,900 in the first two quarters. This firm cites strong demand from central governments and increased buying from India and China as factors for growth.

Despite hesitation in the market, the overall sentiment still maintains a positive light. Analysts at UBS, a Canadian financial firm, summed up Friday’s gains by stating, “The physical market is off to a good start this year, with many indicators so far pointing to a positive demand story.”

Dec 29

Price of Gold Weekly Recap – December 24-28, 2012

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Monday Open: $1,660.40
Weekly High: $1,665.60
Weekly Low: $1,650.90
Friday Close: $1,656.30

The holiday week made for slow trading, and the gold price didn’t fluctuate very much from Monday to Friday – an uncommon phenomenon lately as gold prices have been extremely volatile. All the factors that make gold volatile are still at work, specifically the fiscal cliff, but somehow, the holidays just always seem to make people less jittery than usual. The fiscal cliff deadline has been moved to January 3rd, so we can expect to see more market movement next week. All markets have suffered volatility due to the economic indecision of U.S. leaders. Last week, gold prices fell drastically and now they’re hovering in the mid-$1,600s, about $100 less than the stability of the $1,750 range just a few weeks ago.

Monday, Christmas Eve, the gold market slumped only a little – traders were most likely away from their desks, spending time with family. Tuesday, Christmas Day, the markets were closed as traders enjoyed time off for the holiday.

Wednesday, as the market reopened and people started returning to the world of work, the price of gold took a little upward turn on a low dollar, but trading volume was still fairly thin as it’s natural to want to stretch a holiday as far as possible.

Thursday’s trading was still thin, and the low volume of trading continued through to the end of the week. Thursday and Friday both reacted slightly to continued news of the fiscal cliff, but until more steady news becomes available, the market is fairly numb to the looming decision. The House of Representatives will meet one more time on Sunday night to try and reach an agreement with President Obama. Some pundits expect the January 3rd deadline to be missed, but for politicians to reach some sort of agreement mid-January.

All in all, the price of gold only slipped a net total of $4 this week on thin holiday trading. It seems to have turned into a bear market for gold, and despite recommendations from organizations like Citigroup and Morgan Stanley to pull out of gold, over 80% of gold executives see the price of gold rising in 2013, according to the PwC Gold Price Report. Other notable analysts expect gold to shoot above $2,200.

Dec 14

Price of Gold Weekly Recap – December 10-14, 2012

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Monday Open: $1,711.90
Weekly High: $1,722.00
Weekly Low: $1,692.90
Friday Close: $1,696.30

The big news in gold trading this week was the two-day FOMC conference, economic reports for major world economies, and an automatic trading sell-off in Asian trading. The FOMC conference spiked prices on Wednesday, then sell-off sprees dropped the price for almost no reason on Thursday. Speculation abounds about whether gold has reached its limit as we head into 2013.

Monday was relatively quiet, and not much trading occurred after President Obama and House Speaker Boehner met face to face on Sunday to discuss the fiscal cliff crisis. Traders in all sectors are worried what will or won’t happen before the end of the year, and the fiscal cliff still tends to bring all commodities sectors down, but nothing new brought any light to the situation. The OECD released a report that projected that economies of the U.S., the U.K and China will grow over 2013, but that those of the European Union, Japan and Canada are expected to contract. If world economies are bouncing back, this could be a bearish factor for gold.

Yet, gold responded positively to the news from Tuesday and Wednesday’s FOMC meetings that the Federal Reserve plans to keep interest rates low for approximately the next three years, or until unemployment reaches 6.5%.  The meeting discussed the end of “Operation Twist,” and the beginning of a new bond-buying program, which will entail buying $45 billion of Treasury bonds. The price of gold rose almost $9 on Wednesday.

Yet, Thursday saw some unexpected drops from that high, as Asian trading enacted some automatic sell-stops, which forces selling once a price reaches a certain point. This same trend happened a few weeks ago, for no logical reason, adding an unpredictable factor to gold trading.

The European Union, meanwhile, reached an agreement to appoint a single bank supervisor and EU banking union, which will be a positive sign for their economic recovery. Friday stayed at the low end of the sell-off range to close the week slightly below $1,700.

Gold is undoubtedly a volatile investment at this point in time, and some predict bearish futures for gold, citing that the precious metal is nearing the end of its decade-long streak, but others retain that with the world’s biggest economies still in flux and in the midst of inflation, gold is still a safe hedge fund. Goldman Sachs predicted the end of the gold, while Morgan Stanley credited gold as the “best commodity for 2013.”