Gold News: Quiet & Steady, Ready To Attract Investors
Gold News
In the latest gold news: As of November 27 at 10:25am EST, gold was trading at $1293.12 per ounce, remaining constant at a relatively bounded fluctuation rate. At approximately this time last week, gold was trading at $1289.05 per ounce.
The last few weeks have seen gold remain relatively quiet compared to the earlier fluctuations in the year due to geopolitical tensions. We have seen repeatedly that gold is trading inversely to the dollar and that it is heavily dependent on the dollar momentum for its own price movement. Currently, there are a few factors driving gold’s bounded price range. Firstly, the weakening dollar which is putting upward pressure on gold prices due to people moving from the dollar to the bullion as a safe-haven for investment. Secondly, the market is waiting for the third interest rate hike from the Federal Reserve, expected to occur sometime in December. Thirdly, the market is also worried about other political actions such as the tax reform plans of President Trump, and the dealings with North Korea. Hence, we have three principal engines for gold’s price right now. However, these factors coincide in such a manner that gold has remained relatively stable, and is only now slowly starting to creep back up to the $1300 line. Whether gold will break through that ceiling and stabilize within the next few weeks remains to be seen.
Most investors, however, are not watching gold for the breakthrough at $1300. Gold is currently poised to experience growth over the next year, despite its somewhat quiet and steady movement right now. Some investors believe it could break through $1400 next year. George Gero, a managing director at RBC Wealth Management, stated, “Gold is starting to attract attention of asset allocators […] the market is quiet and steady as we wait for more headlines”. Gero is referring to the headlines regarding the taxes in America and the next Federal Reserve hike in December. Investors in gold are more likely at this point to go long rather than attempting to play the momentum trading game which has been occurring as gold trades more and more closely to a paper item. By going long and waiting for the three more interest rate hikes that are scheduled to happen next year, investors stand to gain much larger upside, since analysts predict that gold will be much higher over the next year rather than right now. It may have lost some of its safe-haven status, but gold is still a steady investment in the long run.
This sentiment remains prevalent and is causing the bullion to remain somewhat steady below this year’s high. In the 7-day gold prediction ending November 19, I Know First’s algorithm based on a stock prediction algorithm showed an impressive 100% accuracy rate, as seen in “Gold Price Predictions Based on AI: Returns up to 2.41% in 7 Days.” After a week, I Know First’s average percent change came out to 1.76% with XAG as the top earner, bringing in an impressive 2.41% return to investors.
