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Gold Survey: Survey Participants See Higher Gold Prices Next Week

Friday July 19, 2013 12:04 PM

(Kitco News) - A majority of participants in the Kitco News Gold Survey see higher prices next week for the metal.

In the Kitco News Gold Survey, out of 36 participants, 19 responded this week. Of those 19 participants, 11 see prices up, while six see prices down and two see prices moving sideways or are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

Last week, 48% of the market participants were bullish. As of noon EDT Friday, prices on the week were up about $20 on the week. Since May 13, 2011 when the survey started, participants have been right 44.6% of the time, as of July 5. Until Nov. 23, survey participants had more than a 50% accuracy rate, suggesting that since then there has been a change in the trend for gold.

Participants who see higher prices said fundamental factors remain supportive for gold.

“Physical supply is down in Comex, bullion bank vaults (and) ETFs (exchange-traded funds). Demand is very strong in China, including Hong Kong and emerging-nation central banks. Indian private physical demand is circumventing RBI (Reserve Bank of India) restrictions through organized smuggling channels. The GOFO (gold forward) rate has been negative for eight straight days,” said Bill Goldman of 3GF Corp.

Those who see lower values cited how gold prices haven’t moved above $1,300 in the August Comex futures as a bearish sign for price direction. “The inability to clear and hold $1,300 is going to grow tiresome for the bullish camp,” said Sterling Smith, futures specialist, commodity research, Citibank Institutional Client Group.

Survey participants who see prices range-bound said there’s little incentive for the market to trade out of the current $1,260 to $1,300 range. “I don’t think we’ll see a move out of this range until the August (U.S. nonfarm) payrolls report,” said Afshin Nabavi, head of trading at trading house MKS (Switzerland) SA.

Kitco Gold Survey

By Debbie Carlson of Kitco News dcarlson@kitco.com

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