Gold News: Bullion Cannot Sustain 17 Month Price Spike

Gold News

In the latest gold news: As of January 22 at approximately 10:21am EST, gold was trading at $1343.37 per ounce, dipping slightly after a peak earlier last week. At approximately this time last week, gold was trading at $1332.43 per ounce.

gold news

Gold recently experienced a massive jump and hit new highs that haven’t been seen in seventeen months. Futures on the metal on Thursday finished at around $1362.90, the highest settlement since August 4th, 2016. This drive upwards was caused by a weakening dollar which had been slowly crumbling in the face of comments from Treasury Secretary Steven Mnuchin who said a “weak dollar was good for trade”. This was a very interesting point in the timeline for gold’s price since many were expecting gold to top out at around $1340 for now. There is much conflicting technical analysis as to where it will go from here–for now, the bullion has dropped in its prices and seems to be sitting comfortably back at the pre-spike prices. In a much longer term view, Jim Rickards, a well-known figure in the gold financial scene, has made claims that gold will hit over $10,000 in the next forty years.

What brought gold back down from the 17 month high was not necessarily something majorly impactful, after all, there were no significant, markets-moving news events during the weekend, but the U.S. dollar index is currently on a corrective rebound, inching higher and thus leading to a lower gold price position. This may because of rising wold bond market yields. This would then mean rising interest rates and rising inflationary pressures. Carsten Fritsch, commodities analyst with Commerzbank, recently stated, “speculative financial investors have not significantly extended their bets on rising prices any further, and ETF investors for the most part were also holding back on buying last week”, which according to Fritsch was responsible for the lower gold prices. He further stated that he is “confident the market will pick up pace again during the course of the week”.

This sentiment has caused the bullion to remain fluctuating around upper price bounds, at least for now. In the 14-day gold prediction ending January 02, I Know First’s algorithm based on a stock prediction algorithm showed an impressive 100% accuracy rate, as seen in “Gold Forecast Based on Algorithmic Trading: Returns up to 4.53% in 14 Days.” After a fortnight, I Know First’s average percent change came out to 4.53% with GLD as the top earner, bringing in an impressive 4.53% return to investors.

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