We have updated our privacy policy and terms & conditions. Find out more here.
0
 

Gold futures - Weekly outlook: January 7 - 11

CommoditiesJan 06, 2013 11:30AM GMT Add a Comment
Investing.com - Gold futures fell to the lowest level since mid-August early Friday, before trimming losses following the release of tepid U.S. non-farm payrolls data, which suggested the Federal Reserve will continue its quantitative easing program in the near term.

On the Comex division of the New York Mercantile Exchange, gold futures for February delivery dropped 1.1% on Friday to settle the week at USD1,655.85 a troy ounce.

Gold prices fell to USD1,626.05 earlier in the session, the lowest since August 21, after the minutes from the Federal Reserve Open Market Committee's December meeting published late Thursday indicated that the central bank could end its bond-buying program earlier than expected.

Moves in the gold price over the past year have largely tracked shifting expectations as to whether the U.S. central bank would pump more money into the financial system.

Futures prices ended the holiday-shortened week with a modest 0.3% loss, the sixth consecutive weekly decline.

Gold prices were likely to find support at USD1,626.05 a troy ounce, Friday’s low and a 19-week low and resistance at USD1,690.55, Thursday’s high.

Gold prices fell sharply after the minutes from the Fed’s most recent policy-setting meeting showed several Fed officials thought the central bank would be able to slow or stop its bond purchases well before December 2013.

The Fed’s quantitative easing program is viewed by many investors as a major source of liquidity that weakens the U.S. dollar and helps support prices of commodities and other hard assets, including gold.

But futures recovered from the lows after the U.S. Department of Labor said the economy added 155,000 jobs in December, easing from an upwardly revised increase of 161,000 in November.

The unemployment rate held steady at 7.8%, suggesting that the recovery in the labor market may be slowing.

The still-high unemployment rate will keep the Fed’s asset-purchase program in place for the indefinite future. The Fed’s December minutes said monetary policy will remain accommodative “at least as long” as the jobless rate remains above 6.5%.

The U.S. dollar moderated strong gains following the release of the lackluster U.S. employment data.

The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, retreated from the session high of 80.99 to settle the week at 80.61.

Gold prices often move inversely to the U.S. dollar, as gold becomes less expensive for buyers using other currencies.

In the week ahead, investors are likely to remain focused on U.S. political wrangling over fiscal policy.

U.S. lawmakers passed a compromise bill to avoid the fiscal cliff last week, however investors remained jittery over the longer term outlook, with negotiations on raising the U.S. debt ceiling still to come in February.

Market participants will also be anticipating monetary policy decisions by the European Central Bank and the Bank of England.

Elsewhere on the Comex, silver for March delivery fell 1.6% on Friday to settle the week at USD30.22 a troy ounce. Despite Friday’s losses, silver futures added 0.5% on the week.

Meanwhile, copper for March delivery declined 0.5% Friday to close the week at USD3.700 a pound. Copper prices climbed 3% on the week.

Gold futures - Weekly outlook: January 7 - 11
 

Related Articles

Crude oil futures higher in U.S. trading hours
Crude oil futures higher in U.S. trading hours
By Investing.com - Dec 19, 2014

Investing.com - Crude oil futures were higher in U.S. trading hours on Friday.On the New York Mercantile Exchange, Crude oil futures for February delivery traded at USD58.26 a ...

Add a Comment

 

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Gold
 
 
 
Are you sure you want to delete this chart?
 
 
 
Are you sure you want to delete this chart?
 
 
 

Successfully Reported

Thank you. This comment has been flagged for a moderator.
_touchLoadingMsg
 
 
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data .

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.