Gold and silver have posted minor gains on what has been a slower than usual week thanks to the Christmas holiday falling on a Wednesday. As trading volumes have been subdued all week it is hard to gauge whether gold and silver’s minor gains can be attributed to anything more than short-covering.
Next week will see New Years fall on a Wednesday which means that for a second straight week we will likely see light trading volumes both in the US and across the globe. US stocks have continued their bullish run this week in the little amount of time they had, something that furthers the notion that investor interest is almost wholly centered on US stocks at the present moment in time.
Holidays Dampen Trading, Stocks Continue Their Run
On Monday and Tuesday, the only real trading days besides Friday, not a lot happened to sway the marketplace in one direction or another. What did happen, however, is that in the small time frame when investors were actually in their offices the US stock markets continued along their bullish run. Ever since the FOMC officially announced tapering over two weeks ago the marketplace has been obsessing over US stocks and such has been seen in incredible gains being posted over the last few weeks.
Unfortunately for gold and silver, however, increased interest in US stocks has taken almost all of the spotlight away from gold and silver, both of which have been on the decline recently. Even though short-covering helped gold and silver post modest gains this week, the outlook on precious metals is still bleak. So long as investor risk-appetite is as high as it has been the past few weeks there is no room for gold or silver to make any positive, lasting gains. Instead, precious metals have been tossed aside and will continue to be avoided until something happens to make investors crave a safer asset to put their investing funds into.
With the end of the year fast-approaching the only moves investors make will be preparatory moves for 2014. In the early stages and latter stages of next week we can expect investors to shed off any unwanted investments and pursue the investments that they think will take them far in the early stages of next year. Though it is hard to say in what direction gold and silver will head throughout 2014, many are thinking that the possibility of further tapering may drive down the spot values of gold and silver even further, though that is yet to be seen.