Monday August 23, 2013 12:04 PM
(Kitco News) - Participants in the Kitco News weekly gold survey expect prices to rise, particularly after the market broke through strong overhead resistance on technical price charts.
In the Kitco News Gold Survey, out of 36 participants, 23 responded this week. Of those 23 participants, 15 see prices up, while seven see prices down and one sees prices moving sideways or are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.
Last week, more than half of the market participants were bullish. As of noon EDT Friday, prices on the week were up about $25 on the week. As of Aug. 9, survey participants have been correct four of the past five weeks.
Gold prices perked up on Friday after an overall lackluster trading week, and a strong close on a Friday is a positive technical chart-based signal, several said.
Jeffrey Nichols, managing director, American Precious Metals Advisors, and adviser to Rosland Capital, said he sees prices rising next week, especially after seeing gold rally following the weaker-than-expected July new home sales data.
“This knee-jerk reaction underscores just how sensitive the prices of gold and other financial assets are to changing expectations -- pro and con -- of imminent tapering. My short-term bullish view (for the next few weeks) is based on my belief that the economic news will continue to disappoint those expecting a rosy economic recovery -- both among the Fed-watching community and among the Fed governors who set policy,” he said.
Those who see weaker prices next week said they haven’t been pleased with gold’s near-term price action.
Bob Tebbutt, of Armour Risk Asset Management, said gold is coming to a critical point. “A move above $1,400 would be very bullish but the market move since the end of June may be getting tired. So I think the market is likely to ease off for a short period of time that could take it back to $1,300,” he said.
There was only one participant who sees prices trading in a range.
Allen Sykora contributed to this survey.
By Debbie Carlson of Kitco News firstname.lastname@example.org