Most Analysts Expect Gold To Stabilize During Quiet Holiday Period

San Francisco (Dec 19)  With everyone now focused on the holidays, most analysts are not expecting to see any major movement in the gold price in the next two weeks.

The trading week in North America will be disrupted as markets are closed on Dec. 25 for Christmas and January 1 for New Year’s Day. Analysts said that liquidity will be extremely leaving most market participants will sitting on the sideline, waiting for activity to pick up in 2015.

Friday, Comex February gold prices settled the week at $1,196 an ounce, down about $26 on the week. Comex March silver prices have settled the week at $16.030, down 99.5 cents on the week.

However, analysts have noted that gold has held up considerably well following the Federal Open Market Committee Meeting, after the Fed said that they don’t anticipate raising rates for at least two meetings.

Colin Cieszynski, senior market analyst at CMC Markets, said that the gold market appears to have stabilized around $1,200 an ounce and could remain around these current levels, until at least the first or second week into the new year.

Cieszynski added that after increased volatility at the start of the month, investors will be happy to step away and take a much needed break.

“I just don’t see too many people wanting to make waves in the next two weeks,” he said. “Even crude oil seems to be stabilizing with [West Texas Intermediate] hovering around $55 a barrel.”

Just ahead of the Christmas break, the U.S. Department of Commerce will release the final estimate for fourth-quarter gross domestic product, however, Julian Jessop, head of commodity strategy at Capital Economics, said that this is the final reading and won’t really shed any new light on the current condition of the U.S. economy.

Source: FORBES