Gold and silver futures settled higher Friday, logging gains for the week on light holiday trading, but the return of futures traders and positive economic data are expected to create headwinds for current prices. Gold for February delivery GCG4 -0.68% settled up $1.70, or 0.1%, at $1,214 an ounce on the New York Mercantile Exchange, for a 0.9% weekly gain, according to FactSet. Earlier in the day, the contract had traded as low as $1,208.50 an ounce.
Similarly, March silver SIH4 -1.49% gained 13 cents, or 0.7%, to settle at $20.05 an ounce, for a weekly gain of 3%. Earlier in the day, it touched a low of $19.75 an ounce.
Both gold and silver prices are existence troubled within a marginal trading chain, because of lessen investor exact as scheme indicators modify and higher consumer requirement on the representation of negociate prices, said James West, portfolio advisor to the Midas Letter Possibleness Fund, in emailed comments. “The backtrack of futures traders from holidays next week will probably see prices belowr become acute pressing in line with U.S. economic data,” said West, who expects new lows for gold beneath $1,100 in January.
It has been a harsh period for gold, with the metal downfield by around 28% since Jan. 1, while silver has dropped around 34% over the equal time. Expectations the Federal Reserve would start to measure rearward its stimulant software helped sink gold originally this year, patch a strong run by equities contributed to flows out of gold, analysts noted.
“As we start 2014, headwinds will still attending themselves with investors state bearish bonds and bullish stocks on raised development expectations and the continuing normalization of interest rates,” said Ole Hansen, leader of commodity strategy at Saxo Bank, in a remark.
“December will appear a 4th month in a row of disinclinedreturns; force and trend pursuing investors will not be altering their looking or positioning unless we see a much more stronger change to the superficies,” Hansen said. “Traders will keep to advance trading into rallies until we see a potential breakout approve above the December high” at $1,268 an ounce.