Gold Price 2014 – Poised for a Great Return
The price of gold experienced an increase of over two percent, which resulted in the highest price within the last two weeks on Thursday. This price increase was gold’s big 2014 comeback since having such a poor performance in 2013.
The gold that is part of the February delivery in the NY Mercantile Exchange’s Comex unit increased $28 per ounce up and reached $1,230.80 during the early afternoon trading hours.
The price of gold was given a boost due to the weakened dollar and investors searching for a bargain. The investor rotation for stocks in the United States experienced a three digit decline that is in stark contrast to the records set in 2013.
Gold’s overall price at the end of 2013 was down a total of 28 percent, which made the cost of an ounce a little bit more than $1,200. This price marked the end of a bull run that lasted for 12 years and saw the price of an ounce of gold rise from $270 per ounce in the year 2000 to its highest price of $1,900 in 2011.
Many investors left the market last year, which resulted in fast-paced selling throughout December. Products that were traded on the exchange and had holdings that were backed by gold experienced the biggest declines since June.
Net sales for 2013 were calculated at 869 tons. 586 tons of that were sold during the first six months of 2013 alone.
Ole Hanson is in charge of the commodity strategy for Saxo Bank in Denmark. He noted that there were only six weeks in 2013 that experienced net buying. He also says that investors should be monitored for signs of new investments in gold thanks to the relatively stable price. These investments may take the form of products traded on the exchange or futures.
Hanson also feels that the majority of the gold ETF outflows have already occurred and because of this, gold is much better situated to react to good investment news. Gold is likely to stay under pressure for the first few months of 2014, but he is hopeful about the second half of the year.
There has been a noticeable contrast between the performances of gold and US stock. The S&P 500 went up almost 30 percent and the DOW blue chip index went up by more than 25 percent.
The less than stellar 2013 gold performance means that it is poised for a great return in 2014. Investors are optimistic that precious metals will out-perform other investments such as equities.