Gold News: Holiday Season Propels Gold Upwards
Gold News
In the latest gold news: As of December 27 at market close, gold was trading at $129.64 per ounce, rising up again after last weeks’ tempered performance. At approximately this time last week, gold was trading at $1261.87 per ounce.
Last week saw the analysts at financial firms write in gold predictions as having a ceiling of resistance at the mid $1260’s level, but following a dip earlier this month gold seems to have broken through and is once again pushing up against the major ceiling of $1300. Although the fallout from the action taken based on the new U.S. senate-approved tax reform bill will likely lead to a stronger dollar and thus a dip in gold in the future, for now the bullion seems to be gaining a foothold in higher prices and upward price movement. Bill Baruch, president of Blue Line Futures, is confident in this movement because it is well backed by strong technical momentum–he cites the prices pushing past the 200-day moving average as a good indicator that the bullion is likely to see some continued upward movement. The 200-day moving average is currently $1278. However, Baruch cautioned that it is not necessarily a good idea to chase gold prices higher in a low-volume environment. This is a risky play as the market is not acting as normal.
In this case, the market is slowing down because of the holiday season. There is a particular lack of liquidity in the market right now, which is also coupled with and related to the weaker dollar. This in total makes for a market that is tempting to invest in due to the growing gold prices but must be approached with caution due to the low volume. Baruch further stated that, “as a reminder, if you bought Dec. 23rd and held through Jan. 11th, you made money 13 out of the last 15 years and your average gain in those years was $27”, implying that statistically this short run is a good bet to take. However, for the more caution minded investor, Colin First, an analyst at FX Empire, has stated that what traders should be watching out for “is the fact whether the prices would hold when the market returns to normal liquidity and volatility”. First makes a good point, and faithful observers of the market will recall that gold has previously come up against the ceiling of resistance of $1300 several times over the last few months and has not succeeded so far in breaking it.
This sentiment has been strong and is causing the bullion to rise up and once again challenge the psychological barrier of $1300. 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.
