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Higher Prices For Gold Expected Next Week – Survey Participants

Friday December 21, 2012 12:05 PM

After this week’s sell-off in gold, most participants in the Kitco News Gold Survey expect the yellow metal’s price to rebound.

In the Kitco News Gold Survey, out of 33 participants, 19 responded this week. Of those 19 participants, 12 see prices up, while three see prices down, and four are neutral or see prices moving sideways. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.
Most of those who see higher prices said they expect gold has found some minor support level at Thursday’s low of around $1,635 an ounce. “Gold (will) rebound from a large sell-off,” said Spencer Patton, founder of Steel Vine Investments.

Plus, many said that they are looking ahead into next year already for when markets revert back to trading their underlying fundamentals, such as ultra-loose monetary policy from most of the world’s central banks.

Those who see weaker prices are pointing to technical charts for their short-term bearish view on gold, especially after it broke support at the 200-day moving average, which came in around the mid-$1,660s earlier this week. “Down, down, down. Risk (is) to $1,520 in gold and beyond that to $1,400 if present patterns persist,” said Mark Leibovit, editor of the VR Gold Letter.

Those who are neutral or see sideways trading said given that the markets are officially in “holiday mode,” the thin volume trading conditions and irregular trading schedules can skew market direction, which makes judging activity difficult.

“The old saying, ‘when in doubt, just get out’ certainly applies to many markets this week. The drama that dominates the news on a daily basis with ‘deal or no deal’ (regarding the fiscal cliff) has many traders moving to the sidelines to wait it out, because you just don’t know how this drama ends,” said Frank Lesh, broker and futures analyst with FuturePath Trading.

Kitco Gold Survey

By Debbie Carlson of Kitco News dcarlson@kitco.com

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