(Kitco News) - Wall Street and Main Street both look for gold to build on its gains next week, based on the weekly Kitco News gold survey.
Comex December gold hit a two-week high of $1,218 an ounce on Thursday. Commerzbank cited several factors – a slightly softer-than forecast U.S. inflation report, a European Central Bank deemed somewhat “cautious” in unwinding loose monetary policy, and a rate hike in Turkey that boosted the country’s currency and thus made gold less expensive for its citizens.
Seventeen market professionals took part in the Wall Street survey. Ten respondents, or 59%, predicted higher prices. There was just one vote, or 6%, calling for lower prices, while six respondents, or 35%, were neutral or looked for a sideways market.
Meanwhile, 485 people responded to an online poll. A total of 250 respondents, or 52%, called for gold to rise. Another 158, or 33%, predicted gold would fall. The remaining 77, or 16%, see a sideways market.
Wall Street
59%
6%VS
Main Street
52%33%For the trading week now winding down, 41% of Wall Street voters and 49% of Main Street respondents were bullish. Around 11 a.m. EDT, Comex December gold was up 0.3% for the week so far to $1,203.70 an ounce.
Ken Morrison, editor of the newsletter Morrison on the Markets, sees the potential for gold to break up through $1,220 an ounce.
“$1,220 has proven to be the show-stopper for gold, but with good support at $1,195 and a dollar that is losing some punch, I expect gold will break through $1,220 in the week ahead, penetrating a short-term trend resistance line connecting from a late July high,” Morrison said. “$1,225 is a realistic upside target next week.”
Kitco senior technical analyst Jim Wyckoff sees steady to higher gold. “Prices are in a fledgling uptrend,” he said.
Phil Flynn, senior market analyst with at Price Futures Group, also sees more gains.
“Trade-war talks as well as the fact that some are worried that the Fed may pause after the September rate hike is giving us some support,” Flynn said. “The flattening yield curve could inspire more buying.”
Colin Cieszynski, chief market strategist at SIA Wealth Management, is bullish on gold for next week.
“We’re entering the strongest time of the year seasonally for gold and at the same time, I think the headwind from the rising U.S. dollar could ease in the short term. Gold regaining $1,200 and shrugging off weakness earlier in the week suggests to me that support is starting to come in behind gold once again.”
Meanwhile, David Madden, market analyst at CMC Markets, was the lone Wall Street bearish vote on gold.
“I don’t expect to see a lot of movement in gold right now, but if I had to pick a side, I think you have to look to the downside,” Madden said.
Kevin Grady, president of Phoenix Futures and Options, said he is neutral. “There is a lot of news that is driving the markets right now, so I think less people are inclined to get short at these levels,” he said.
Sean Lusk, director of commercial hedging with Walsh Trading, sees a sideways market.
“The market can’t extend for whatever reason,” Lusk said. “Stocks may be hurting it. There’s no safe-haven buying….We’ve got to get a catalyst to move higher. There needs to be a reason to cover shorts or build longs.”
Here are two comments from Main Street voters:
“Short term, both gold and silver have some more way to drop before a historic recovery.”
“I think gold is range-bound [between] $1,175-$1,225 until the midterm elections. What did Jim Rogers
say - waiting for $1,130? Hope he’s wrong, but if he’s not, I’ll gladly add some FSAGX to my 401[k]. Have a nice day, pray for those in the path of the hurricane.”
