This year gold prices were seemingly out of whack, as it continuously bottoms out before rallying for a short stretch and then repeating the cycle over and over again for the last 3 quarters. Most analysts are under the impression that that gold prices could go as low as 1,072 dollars per troy ounce with some analysts swearing that it might even test the 1.000 dollar per troy ounce mark. However, these predictions are not entirely solid due to the fact that the significant increase in the value of the dollar has made gold somewhat cheaper for those who have been holding on to the US dollar.
The rise in the US dollar and the fall in gold prices are the counter balance as buying gold in other currencies have become expensive and as such market demand for gold from nations who do not use dollar has softened to a significant level, which is the main reason that gold may even fall further than 1000 dollars per troy ounce and might even go as low as 900 dollars per troy ounce by the end of the year IF the US dollar continues to raise the bar.
Market players are anticipating the 0.25 FED rate hike in December in order to restore credibility in the US dollar which might cause the dollar to take a dive and boost gold prices. From a diffe3rent perspective however the hike could also bring the prices down conversely due to the attractive capital markets and on the other hand, if the FEDs do not hike prices, then the precious metal markets should ‘logically’ rally. According to ‘experts’ the current resistance level of gold is at 1137 dollars per troy ounce, and if at all the prices of gold were to breach this resistance level a rally would definitely be underway.
Although this window of opportunity may seem small, if at all the gold price breaks the 1137 resistance level, it has the potential to rally all the way to 1150 before meeting the next resistance level, from then on – it is left to be seen.