Categories:
General Market Commentary
/
Precious Metals
Topics:
General Market Commentary
/
General Precious Metals
Wall Street, Main Street expect gold price uptrend to continue
(Kitco News) - Wall Street and Main Street alike look for gold to continue the recent bounce next week.
Thirteen market professionals took part in the Wall Street survey. Ten, or 77%, called for gold to rise. There were no votes saying gold would fall, with three voters, or 23%, neutral or calling for a sideways market.
Meanwhile, 820 votes were cast in an online Main Street poll. A total of 475 voters, or 58%, looked for gold to rise in the next week. Another 208, or 25%, said lower, while 137, or 17%, were neutral.
Wall Street
Bullish
77%
Bearish
0%
Neutral23%
VS
Main Street
Bullish58%
Bearish25%
Neutral17%
In last week’s first gold survey of the year, the largest Main Street and Wall Street voting blocs were bullish, although respondents overall were somewhat mixed with no camp garnering more than 50% of the vote. As of 10:42 a.m. EST, Comex February gold was 0.3% lower for the week so far to $1,555.10 an ounce.
The Comex February futures rose to a roughly seven-year high of $1,613.30 an ounce on Jan. 8 when the world was worried about a war between the U.S. and Iran. Prices subsequently fell back as tensions de-escalated, bottoming at $1,536.40 an ounce on Tuesday, before the metal began working its way higher again.
“I think we are going to continue upwards next week,” said Bob Haberkorn, senior commodities broker with RJO Futures. “It’s due solely on some actions you’re seeing at night by the Fed … with the liquidity injections they’ve doing.”
Further, he added, even though equities have been hitting record highs, some investors have been moving into gold as a safety play just in case stocks suddenly correct sharply lower.
Richard Baker, editor of the Eureka Miner’s Report, also said higher, pointing out that gold has been able to climb alongside equities. He also cited low interest rates.
“If the S&P 500 reaches 3,350 next week, gold must make $1,580 per ounce to stay above water,” Baker said. “I'm optimistic that this is possible given residual uncertainty about the U.S. election, corporate earnings and 2019 growth. My vote is up, with silver following that level to $18.31 per ounce.
“From an interest-rate perspective, even with a trend higher in global yields, a bullish environment remains for a non-interest-earning asset like gold. Negative or near-zero interest rates for major countries and near-zero real rates in the U.S. remain in place.”
Charlie Nedoss, senior market strategist with LaSalle Futures Group, looks for gold to be sideways to higher, but emphasized that much will hinge on whether February gold can close above the 10-day moving average near $1,558. As he spoke, gold was within striking distance of this.
“The close is very important today,” Nedoss said. “If we close above that 10-day, that will be viewed as constructive.”