Gold & Silver Appear To Be "Bottoming Out"

New York (Jan 19)  As the markets gear up for Thursday’s European Central Bank meeting, CMC Markets says the eurozone may have a bigger impact on gold prices than the U.S. in the coming year. “What the ECB does with its balance sheet may also have a big impact on gold in the coming year… gold has followed the rise and fall of the ECB’s balance sheet and EUR more closely than the U.S., its traditional opponent,” says Colin Cieszynski, chief market strategist at CMC Market, in his 2015 Market Outlook report released last week. “Increasing political, financial or economic tensions in the eurozone may force the ECB to take more decisive stimulus action to hold everything together, which may create a more favorable environment for gold this year,” he adds. Cieszynsky notes that the recent rise in gold prices shows that market participants are increasingly seeking safe-haven assets. “Growing political risks, rising treasury yields and credit rating cuts in Europe combined with a rebound in gold indicate a growing recognition that risks have started to increase again,” he says, adding that gold and silver could continue higher. “While crude oil has been under pressure into the end of 2014, gold and silver appear to be bottoming out and could be poised to continue rebounding in 2015.” As a side note, Cieszynsky points out that based on historical data, 2015 may be a positive year for financial markets. “Historically, years ending in five have been the strongest of the decade, averaging nearly a 25% return since 1970.”

Source: KitcoNews