Gold prices went back to being downward after buyers stepped back as prices surged to an unattainable $1,850 – $1,900 range.
With the year-end holiday season sales set to begin, this week prompted many to doubt whether the price was going back to the prior peak price levels.
Spot gold prices came down 0.4% at $1,832 per ounce. It dropped as much as 2.5% a day before. After being priced at $1,777 in November, the price of yellow metal rose by nearly $100 to $1,871 this week.
Gold is considered a safety shield against inflation, currency debasement and political and economic uncertainty.
For a technical market investor, the price jump was good news in terms of investment. However, this positive outlook was altered when prices fell below $1,850. Analysts say that if the decline persists, the next holding point for prices would be at $1,830 followed by $1,815.
Gold prices saw the biggest decline in four years in November as optimism over a coronavirus vaccine led economic rebound took some of the shine off assets like gold. Gold was down about 6% the previous month. The metal has declined nearly 15% from its record high set earlier in August.
After the yellow metal being at a high of $2,070 an ounce in August, it is now more attainable at $1,800.
With prices expected to stay low, shoppers will be ready for some year-end spending. As it has been a trend in the past years for the metal’s price to drop in the year ending weeks, analysts predict prices dropping back to the mid $1,700s in the coming weeks.
However, the view among analysts still stands that a renewed push for prices to go above $2,000 per ounce in the next 3-6 months.