Gold Hits Multi-Week High

//Gold Hits Multi-Week High

Gold Hits Multi-Week High

  • Gold price increase

The price of gold bounced nicely off of the $1210 support level in the last few weeks, and that price move culminated in a 7-week high with the price closing at $1246.10 on January 10. Net long positions rose 18% to over 40,000 contracts as speculators looked for the yellow metal to make a run in the early part of 2014.

Investors are clearly looking for the price of gold to bounce back from multi year lows that were established in December 2013. Gold traders have been increasingly bullish in response to anticipated Federal Reserve measures which are anticipated after weaker than expected data was released on Friday regarding the U.S. labor market. The newly created jobs number was drastically lower than expected- 200,000 new jobs was the number that Wall Street was looking for, and the actual number of newly created jobs came in at a paltry 74,000. Unemployment lowered from 7% to 6.7 %, although this number was skewed as nearly 350,000 workers gave up their search for employment and abandoned the job market.

In response to this new jobs data, the February gold futures contract gained $17.50 and closed at $1246.90, marking the highest settlement price that gold has seen since December 10th of last year. A reduction in quantitative easing had earlier been expected by the Fed, but with the new jobs data released it appears that even more money will have to be pumped into the economy. This new inflationary outlook spurred the price of gold higher, with the specter of more cash printed acting as a catalyst for the rise in gold prices.

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Image courtesy of Stuart Miles/ FreeDigitalPhotos.net

2016-10-31T12:20:05-04:00By |Categories: Gold News|

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President and CEO of National Coin Broker
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