Tuesday, 5 December 2017 19:58 WIB | GOLD CORNER |Gold OutlookGold Corner
Gold is unlikely to end the year at yearly lows, but it won't be able to escape the December curse entirely, according to one commodity analyst.
Since 2013, gold has carved out a fairly familiar year-end pattern with prices falling to or near yearly lows in December. And during the last month of 2015, gold hit multi-year lows, which has now become the floor in a new bull market for many analyst.
Andrew Hecht, creator of the Hecht Commodity Report, said that negative sentiment is growing in the gold market as prices hover near the bottom end of a narrow range. However, he added that the market is in a very different shape than it was during the past two years.
œIt is possible that as the dollar is a lot closer to the lows than the highs this year, precious metals will not repeat their price action of the previous two years, he said in a recent commentary. œGold is going into the final month of 2017 with a strong and bullish tone compared to the price action at the end of 2015 and 2016. Higher rates are likely weighing on the yellow metal while the price action in the dollar and geopolitical landscape combine to provide support for the price of the precious metal that thrives during times of fear and uncertainty.
Despite struggling in its narrowest trading range in more than a decade, gold has shown some resilience, as prices remain up 10% since the start of the year. February gold futures last traded at $1,248.30 an ounce, down 0.31% on the day.
While gold is ending the year with bullish potential, Hecht also warned that it does face headwinds like a weaker silver market.
In 2017, silver has struggled and is currently flat on the year. March silver futures last traded at $16.37 an ounce, down 0.14% on the day.
œMany market participants have thrown in the towel in silver and the metal is not attracting speculative demand in the current environment. The weakness in silver could continue to weigh on the price of gold, he said.
Source: Kitco News