Weaker prices for gold are expected next week, say a majority of the participants in Kitco News’ weekly gold survey, as the recent rally may have run its course for the short-term.
Several participants, however, see prices as unchanged next week or are neutral on their view of prices.
In the Kitco News Gold Survey, out of 32 participants, 24 responded this week. Of those 24 participants, six see prices up, while 11 see prices down, and seven are neutral on prices. Market participants include bullion dealers, investment banks, futures traders, money managers and technical chart analysts.
Those participants who look for weaker prices said after the recent run up in prices, gold is vulnerable to a retracement. Ken Morrison, editor of the online newsletter, Morrison on the Markets, pointed out that the rally has come with a steady level of open interest in futures and no change in the net ownership of the SPDR Gold exchange-traded fund (GLD) since Dec. 22. “Gold has managed to sustain a strong rally following its 5-month low at the end of December, basically on day-trading and the 'notion' of possible more global QE. With 10 days to go before the FOMC meeting, I expect the coming week to be corrective week with a pullback in gold to around $1,600” an ounce, he said.
Those who see higher prices said momentum may carry the market higher, to about $1,675, noting that the underlying fundamental story for gold remains supportive for prices.
The participants who are neutral on prices are waiting for better signals to enter the market. “There’s no conviction in either direction so lay low. The upside is coming soon,” said Arnett Waters, president, A.L. Waters Capital.
Source; http://www.kitco.com/kgs/goldsurvey_january13.2012.html
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