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Gold Outlook - Not Laborious At All

Summary

Gold is recovering lost ground after Friday's favorable labor data and should enjoy positive momentum near-term.

Fresh economic data will continue to influence the U.S. dollar and gold, and most recently has been favorable for gold.

Other factors may start to gain weight that could also favor gold near-term.

However, risk remains that the Fed could still act on rates and again threaten gold prices in the weeks ahead.

Last week, two consecutive uptick days allowed gold to close the period about where it opened it. Looking forward, the tone of the shortened holiday week has been set by last Friday's gold-favorable labor market report. Gold was charging higher again Tuesday. All economic data will likely matter to gold's price determination for the next two weeks as the market continues to contemplate the Fed's September decision. Other factors may now gain some weight in the valuing of precious metals as well. Gold is likely to continue to reflect relief, as the tone shifts back to positive for gold and negative for the U.S. dollar this week. We continue to recommend physical gold for long-term portfolio diversification and wealth preservation purposes. Relative precious metal security positioning for shorter time frames is due greater discretion in this time of uncertainty that is likely to see significant swings in either direction.

Weekly Chart of GLD at Seeking Alpha

First a Look Back

Last week's trading was first influenced by anticipation of the monthly Employment Situation Report and what indication it might give toward the Fed's September monetary policy decision. But the week proved much more interesting than one day's data could determine.

Precious Metal Securities

09-06-16

11:40 AM

SPDR Gold Trust (NYSE: GLD)

+1.1%

Sprott Physical Gold Trust (NYSE: PHYS)

+1.2%

iShares Silver Trust (NYSE: SLV)

+1.9%

Direxion Daily Gold Miners Bull 3X (NYSE: NUGT)

+10.5%

Direxion Daily Gold Miners Bearish 3X (NYSE: DUST)

-10.4%

Market Vectors Gold Miners (NYSE: GDX)

+3.4%

Market Vectors Junior Gold Miners (NYSE: GDXJ)

+4.3%

Goldcorp (NYSE: GG)

+3.3%

Newmont Mining (NYSE: NEM)

+2.3%

Randgold Resources (NASDAQ: GOLD)

+2.5%

Barrick Resources (NYSE: ABX)

+2.0%

Yamana Gold (NYSE: AUY)

+5.4%

Gold Fields Ltd. (NYSE: GFI)

+1.8%

Silver Wheaton (NYSE: SLW)

+3.0%

Coeur Mining (NYSE: CDE)

+7.9%

Click to enlarge

At the start of the period, I expected gold to benefit from the fading of fear about the Fed following the losses inspired by the Jackson Hole discussions. However, gold only built upon that fear at the start of the week and fell further...


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