Dealing Desk: Gold volatile but still in festive mode

Dec 11, 2014·Roland Khounlivong

In a week that's seen more window dressing of GoldMoney client investment portfolios than serious directional decisions, gold has had a volatile few days thanks to a variety of factors.

Head of Dealing and Settlements, Roland Khounlivong said, 'The better than expected economic figures out of the US were all good news for the dollar but not so positive for the gold price. Then the downward spiral of oil prices increased deflationary pressure on the global economy which again put a negative spin on gold which is traditionally seen as a hedge against inflation.

Tuesday's big sell off in global equities, led by the Chinese, sent some investors hunting for a safe haven and that helped gold to break back through the US$1200 mark. For GoldMoney customers it provided an opportunity to sell the yellow metal in a rising market and so we've ended with net selling of gold for the week.

Overall, however, we've seen as many buyers as sellers across all the precious metals with silver benefitting from bargain hunting. This is usual for this time of year with the market traditionally quiet ahead of the festive period. Although volumes were 50% up on last week, we're a long way away from the kind of activity we saw in early November. It's going to take a much bigger catalyst to trigger any significant buying or selling this side of the new year, although the triple witching* at the end of next week might inject some further volatility.'

*An event that occurs when the contracts for stock index futures, stock index options and stock options all expire on the same day. Triple witching days happen four times a year on the third Friday of March, June, September and December.

16:00 11/12/14: Week on week performance: Gold rose just 1.1% to $1,222.40; Silver gained 3.1% to $17.06; Platinum slipped 0.2% to $1,238.65 while Palladium put on 1.9% to $817.97.


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