Majority of Market Players Expect Near-Term Rise in Gold Prices: Report

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A vast majority of survey participants in the weekly Kitco News gold survey see higher prices for the yellow metal, based on the likelihood that the debate over the "fiscal cliff" in the U.S. will drag on, Kitco reported.

Out of 33 participants, 25 responded this week. Of those 25 participants, 18 see prices up, while two see prices down, and five are neutral or see prices moving sideways. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

"The main risk would be of Washington suddenly coming to their senses and coming up with a comprehensive plan to cut runaway government spending and entitlement programs in order to balance the budget. On second thought, that's not much of a risk. No doubt there will be soothing words as the problem is pushed further into the future, and gold could react negatively in the short term to that, but fundamentally things are still positive for gold," said Adrian Day, chairman and chief executive officer of Adrian Day Asset Management.

Others suggested seasonal trends remain in gold's favour. Those who see prices unchanged or are neutral on gold all said they expect the market to be range-bound, with the $1,700 (U.S.) area acting as strong support and the $1,735 to $1,750 area as resistance.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Commodities

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