Gold Price Consolidates Above $1,300 After 1.2% Gain Last Week

January 28, 2019

Gold futures settled above $1,300 an ounce on Friday, with prices for the yellow metal at their highest since June as the U.S. dollar pulled back and investors eyed geopolitical turmoil and global growth worries.

Rising gold prices reflect “political uncertainty” in the U.S., Eurozone, Venezuela and pockets of South America, as well as China-U.S. trade talks, said George Gero, managing director in RBC.

Gold for February delivery added $18.30, or 1.4%, to settle at $1,304.20 an ounce after trading as high as $1,305.80. The April contract notched its highest finish since June and climbed by 1.2% for the week, according to FactSet data.

March silver rose 39.9 cents, or 2.6%, to $15.699 an ounce—settling 2% higher for the week.

Gold Note

The strong gains seen in gold and silver last week and gold’s close above $1,300 per ounce are bullish technically. It suggests that gold has broken out of its recent range and could move higher in the coming days.

Possibly what will determine gold’s short term price outlook is how equity markets perform. If risk appetite continues and stocks make further gains, gold may see some selling again. However, if stocks resume their declines then gold will likely catch a safe haven bid again.

We have seen an increase in safe haven demand from UK and Irish clients in recent days. It is nothing major though and nothing compared to the increase in demand we saw after the Brexit vote, the Northern Rock bank run or indeed the global financial crisis in 2008.

We are seeing little or no selling and nearly all buying. Bullion buyers tend to be risk averse and motivated by wealth preservation and therefore focus on owning gold (and silver) for the long term.

Courtesy of via Marketwatch:

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Mark O'Byrne is executive and research director of www.GoldCore.com which he founded in 2003. GoldCore have become one of the leading gold brokers in the world and have over 4,000 clients in over 40 countries and with over $200 million in assets under management and storage.We offer mass affluent, HNW, UHNW and institutional investors including family offices, gold, silver, platinum and palladium bullion in London, Zurich, Singapore, Hong Kong, Dubai and Perth. 

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