According to Jon Nadler, analyst for Kitco.com, activity slowed considerably ahead of the long holiday weekend and final week of the year with gold prices meandering between $618 and $622.
“As we close out this year, there are many unresolved issues still lingering in the global background picture. No clear choice has emerged on the next phase or costs of the war in Iraq, the N. Korean situation remains as murky as ever, Iranian nuclear development is no closer to cessation, and the Middle East remains a tense region.”
“On the economic front, schools of thought are equally divided on whether a serious slowdown is in the making or if inflation and overheating are the more imminent dangers.”
“We remain of the opinion that an unwelcome combination of both forces may dominate the better part of 2007 - and that such conditions will be superimposed upon a still-deteriorating U.S. dollar.... Given such an amalgam of uncertainty, and the fact that it is normally difficult to hedge against the unknown, gold will continue to gravitate towards the $700 zone,” said Nadler.
"A smaller than the current 25% annual gain may be in the cards for bullion but the overall rising trend remains in place and we do not see significant derailment factors in the wings," Nadler concluded.
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